What are the primary differences between a bond and a stock?(1 point)

Question

Responses

Stocks are certificates debt, while bonds are units of ownership in a corporation.
Stocks are certificates debt, while bonds are units of ownership in a corporation.

Stocks are contracts that specify duties to the corporation, while bonds are units of ownership in a corporation.
Stocks are contracts that specify duties to the corporation, while bonds are units of ownership in a corporation.

Stocks are units of ownership in a corporation, while bonds are certificates of debt.
Stocks are units of ownership in a corporation, while bonds are certificates of debt.

Stocks are units of ownership in a corporation, while bonds are contracts that specify duties to the corporation.

Answer 1

The primary differences between a bond and a stock are best summarized by the following statement:

Stocks are units of ownership in a corporation, while bonds are certificates of debt.

This means that when you purchase stocks, you are buying a share of ownership in a company, whereas when you buy bonds, you are lending money to the company (or government) with the expectation of being paid back with interest.