David Owns 15 Percent of the Shares of Common Stock

question 27

Multiple Choice

David owns 15 percent of the shares of common stock currently held in BIGD Analytics Co. At the most recent meeting, the board of directors authorized the sale of 250,000 new shares of stock to raise funds. As an existing stockholder, David may have a _________ to buy up to 37,500 shares of the new stock before it is offered to the public.

• A)preventive right
• B)cumulative right
• C)secondary right
• D)preemptive right

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Definitions:

Try-demo Units

Sample products or systems that are offered for trial use to demonstrate their capabilities or features before a purchase decision is made.

Trialability

The degree to which a product or service can be experimented with on a limited basis before making a purchase decision.

Failure Rate

The proportion of a product, process, or service failing within a specific period under normal conditions.

Brainstorming Sessions

Group activities designed to generate creative ideas or solve problems through spontaneous participation.