Currently, You Own 5% of the Common Stock of Alberta

question 380

Multiple Choice

Currently, you own 5% of the common stock of Alberta Industries. The right which grants you the ability to maintain your current level of ownership should the company opt to issue additional
Shares of stock is called the _____ right.

• A) Shareholder
• B) Percentage
• C) Cumulative
• D) First
• E) Preemptive

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Definitions:

All Equity Firm

A company that is financed solely through equity without the use of debt or leverage, relying entirely on shareholder funds.

Closely Held

A descriptor for corporations that have a small number of shareholders, with shares not publicly traded and often owned by family members or a small group of investors.

Borrow

The act of obtaining or receiving something with the intention of returning it or its equivalent, often involving money with an agreement to pay interest.

Capital Structure

The mix of different types of debt and equity that a company uses to finance its overall operations and growth.