The Preemptive Right Is Important to Shareholders Because It

question 78

Multiple Choice

The preemptive right is important to shareholders because it

• A) Allows management to sell additional shares below the current market price.
• B) Protects the current shareholders against dilution of ownership interests.
• C) Is included in every corporate charter.
• D) Will result in higher dividends per share.
• E) The preemptive right is not important to shareholders.

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Definitions:

CSR Activities

Corporate Social Responsibility activities are actions taken by businesses to improve society and contribute positively to the community and environment.

Future Generations

Individuals who will live in the succeeding periods, whose interests are considered in long-term planning and sustainability efforts.

Eco-Efficiency Measure

An assessment of the economic performance of a process or product in terms of its environmental impacts, aiming for sustainability by reducing resources used and waste produced.

Material Price Efficiency

Material price efficiency is a measure of how effectively a business acquires its materials at a cost equal to or less than the standard or expected cost.