What Are the Major Differences Between Preferred Stock and Common

question 25

Multiple Choice

What are the major differences between preferred stock and common stock?

• A)Preferred stock dividends are paid out before dividends on common stock can be issued.
• B)Common stock has voting rights and preferred stock does not.
• C)Common stock has potentially higher capital gains than preferred stock.
• D)All of the above are correct.
• E)Only A and B are correct.

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Definitions:

Trend

A general direction in which something is developing or changing over time.

Moving Average

A statistical measure to smooth out short-term fluctuations and highlight longer-term trends or cycles in data.

Exponential Smoothing

A technique used in time series forecasting that applies decreasing weights to past data, giving more importance to more recent observations.

Stationary Time Series

A type of time series data where statistical properties such as mean and variance are constant over time.