The Right to Buy New Shares of Stock in Proportion

question 20

Multiple Choice

The right to buy new shares of stock in proportion to stock already owned is called a

• A) stock right.
• B) stock option.
• C) Section 1244 right.
• D) preemptive right.

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Definitions:

Worn-Out Machinery

Worn-Out Machinery refers to equipment that has reached the end of its useful life due to wear and tear, aging, or obsolescence.

Expanding Current Operations

The process of increasing the scale or scope of a company's business activities.

Accrued Interest

The accumulation of interest on a loan or bond since the last payment date but not yet paid out to the lender.

Gain on Sale of Investments

The profit realized from selling investments for more than the purchase price.