If Preferred Stock Is Participating, Then

question 64

Multiple Choice

If preferred stock is participating, then

• A)preferred dividends are a percentage of corporate profits.
• B)preferred shareholders vote in the election of the members of the board of directors.
• C)preferred shareholders share in the remaining amount of dividend with common shareholders.
• D)dividends in arrears must be paid before common shareholders receive dividends.

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Definitions:

Competition

The rivalry among businesses to attract customers, increase sales and market share, and achieve a sustainable competitive advantage.

Fosters Efficiency

Encourages or promotes greater productivity and effectiveness in processes or systems.

Monopolistic Competition

A market structure characterized by many firms offering similar but not identical products, allowing for some degree of market power.