Which of the Following Statements Is CORRECT

question 36

Multiple Choice

Which of the following statements is CORRECT?

• A) Preferred stock generally has a higher component cost of capital to the firm than does common stock.
• B) By law in most states,all preferred stock must be cumulative,meaning that the compounded total of all unpaid preferred dividends must be paid before any dividends can be paid on the firm's common stock.
• C) From the issuer's point of view,preferred stock is less risky than bonds.
• D) Whereas common stock has an indefinite life,preferred stocks always have a specific maturity date,generally 25 years or less.
• E) Unlike bonds,preferred stock cannot have a convertible feature.

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Definitions:

Expectations

refer to the beliefs or forecasts that individuals have about future events or behaviors.

Diversity Competency

The ability to understand, respect, and effectively interact with people from various backgrounds and cultures.

Inclusion Index

A measure or assessment of the extent to which an organization's environment is open, supportive, and welcoming to all individuals, regardless of their diverse backgrounds.

Diversified Supplier

A business that offers a wide range of products or services, often to minimize risks associated with dependence on a single source.