Instructions
1. What is the main difference between a bond and a share of stock?
2. What are the contract rate and the market rate for bonds?
3. Describe the debt-to-equity ratio and explain how creditors and owners would use this ratio to evaluate a company’s risk.
4. What obligation does an entrepreneur (owner) have to
investors that purchase bonds to finance the business?
5. Compare and contrast and operating lease with a capital
lease.

Instructions
1. What is the main difference between a bond and a share of stock?
2. What are the contract rate and the market rate for bonds?
3. Describe the debt-to-equity ratio and explain how creditors and owners would use this ratio to evaluate a company’s risk.
4. What obligation does an entrepreneur (owner) have to
investors that purchase bonds to finance the business?
5. Compare and contrast and operating lease with a capital
lease.