Preemptive Right Is Important to Shareholders Because It

question 62

Multiple Choice

preemptive right is important to shareholders because it

• A)allows managers to buy additional shares below the current market price.
• B)will result in higher dividends per share.
• C)is included in every corporate charter.
• D)protects the current shareholders against a dilution of their ownership interests.
• E)protects bondholders, and thus enables the firm to issue debt with a relatively low interest rate.

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Definitions:

Sample Statistic

A numerical measure that describes an aspect of a sample.

Population Parameter

A numerical value summarizing a characteristic of an entire population.

Point Estimate

A single value given as an estimate of a population parameter, derived from sample data.

Population Parameter

A characteristic or measure that describes an aspect of an entire population, such as its mean or standard deviation.