金融英语_刘文国第二版课后练习Exercises12.pdf

Exercises twelve I. Answer following questions 1. What does stock mean? A type of security that signifies ownership in a corporation represents a claim on part of the corporation's assets and earnings. 2. What does dividend mean? The dividend is a distribution of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders. The dividend is most often quoted in terms of the dollar amount each share receives (dividends per share). It can also be quoted in terms of a percent of the current market price, referred to as dividend yield. 3. What Does Equity Mean? A stock or any other security represents an ownership interest. On a company's balance sheet, the amount of the funds contributed by the owners (the stockholders) plus the retained earnings (or losses), also referred to as "shareholders' equity". In the context of margin trading, the value of securities in a margin account minus what has been borrowed from the brokerage. In the context of real estate, the difference between the current market value of the property and the amount the owner still owes on the mortgage. It is the amount that the owner would receive after selling a property and paying off the mortgage. In terms of investment strategies, equity (stocks) is one of the principal asset classes. The other two are fixed-income (bonds) and cash/cash-equivalents. These are used in asset allocation planning to structure a desired risk and return profile for an investor's portfolio. 4. Why does a company issue stock? The reason is that at some point every company needs to raise money. To do this, companies can either borrow it from