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Describe two characteristics that differentiate debt and equity. in depth.

Describe two characteristics that differentiate debt and equity. in depth.

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Answer #1

1) Risk

In case of debt there is less risk because the investers will get guaranteed return annualy irrespective condition of the company. Also They will get fixed percentage if company has higher return.

In case of equity they has no guaranteed percentage or return , if the company has any enough fund tgen only company pays divident .

If the company earns high investers will get higher divident.

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