Preferred Stock Is the Most Used of All Long-Term Securities

question 25

Multiple Choice

Preferred stock is the most used of all long-term securities because?

• A) Investors can get higher returns after taxes than from other investments.
• B) Preferred dividends are considered regular (fixed)obligations.
• C) Flotation costs are extremely low compared to bonds.
• D) It is not the most used security due to no right to vote.

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Definitions:

Production Line

An efficient arrangement of machinery and workers in which a product is assembled in a sequence of operations.

Deming

Refers to W. Edwards Deming, an American engineer, statistician, professor, author, lecturer, and management consultant known for his work in quality management.

Anticipation

The act of expecting or foreseeing something, often involves preparing for future events or changes.

Prevention

The action of stopping something from happening or arising, especially in terms of health and disease.