Preferred Shareholders

question 45

Multiple Choice

Preferred shareholders

• A)typically have the same voting rights as common shareholders.
• B)do not share the ownership of the firm with common shareholders.
• C)typically participate in the profits of the firm beyond the stated fixed annual dividend.
• D)may not receive a dividend every year.

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Definitions:

Decision Making

The method of selecting options through recognizing a decision, collecting data, and evaluating different solutions.

Net Benefits

The total positive effects or gains from a decision or action minus any negative effects or costs associated with it.

Prospect Theory

A behavioral economics theory of preferences having three main features: (1) people evaluate options on the basis of whether they generate gains or losses relative to the status quo; (2) gains are subject to diminishing marginal utility, while losses are subject to diminishing marginal disutility; and (3) people are prone to loss aversion.

Salary

A form of payment from an employer to an employee, which may be specified in an employment contract.