Which of the Following Statements Is Most Correct

question 15

Multiple Choice

Which of the following statements is most correct?

• A) One of the advantages to the firm associated with financing using preferred stock rather than common stock is that control of the firm is not diluted.
• B) Preferred stock provides steadier and more reliable income to investors than common stock.
• C) One of the advantages to the firm of financing with preferred stock is that 70 percent of the dividends paid out are tax deductible.
• D) Statements a and c are correct.
• E) Statements a and b are correct.