Answer the following in 100 or less:
1. Explain the relationship between earnings per share, projected earnings, and the market value for a stock.
2. Why would a corporation sell common or preferred stock to raise equity financing?
3. What is the difference between common and preferred stock? What type of investor would invest in preferred stock?
4. Assume that you are choosing an investment for your retired parents. Would you choose a bond issued by the federal government or a bond issued by a state or local government? Justify your answer.