2
InstructionMultiple Choice

Stocks vs. Bonds

Question 2 • ****Spring 2026 Financial Math - MA2007 MQS21QXV

What is the largest difference in stocks and bonds?

Answer
A
Bonds are a binding contract, promising the holder a portion of the company's annual profit, unless it is unprofitable, while stocks are a very standard investment and pay off a predetermined amount after a period of time.
B
Stocks are a share of ownership in a company and give the stockholder voting rights, while bonds are similar to lending a company or government money.
C
Stocks are the most secure of all investments and bonds are some of the least secure.
D
Bonds are available to the public, while stocks are reserved for the financial elite.

Explanation

Stocks represent partial ownership in a company and may give shareholders voting rights. Bonds, by contrast, are loans made to a company or government, which typically promises to repay the loan with interest. Therefore, choice B correctly describes the largest difference between stocks and bonds.

AI-written and checked against the verified answer.

Previous
Next