ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Shares are units of equity ownership in a corporation. For some companies, shares exist as a financial asset providing for an equal distribution of any residual profits, if any are declared, in the form of dividends. Shareholders of a stock that pays no dividends do not participate in a distribution of profits.

Detailed explanation-2: -The Definition of a Stock Plain and simple, stock is a share in the ownership of a company. Stock represents a claim on the company’s assets and earnings. As you acquire more stock, your ownership stake in the company becomes greater. Whether you say shares, equity, or stock, it all means the same thing.

Detailed explanation-3: -Owning stock means being one of the owners of a company. Company owners are assigned ownership units called shares. The number and importance of shares an owner has depend on how soon and how much they invested in the company.

Detailed explanation-4: -A share is the single smallest denomination of a company’s stock. So if you’re divvying up stock and referring to specific characteristics, the proper word to use is shares. Technically speaking, shares represent units of stock. Common and preferred refer to different classes of a company’s stock.