Preferred Stockholders

question 77

Multiple Choice

Preferred stockholders

• A)are paid a fixed dividend before common stock holders have been paid a dividend.
• B)do not have voting rights in the corporation.
• C)must be paid a dividend only if the corporation earns a profit.
• D)All of the above are correct.

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Definitions:

Option's Value

The intrinsic and time value associated with an options contract, determining the premium at which it trades on the market.

Variable

An element, feature, or factor that is liable to vary or change.

Option Vega

A measure of an option's sensitivity to changes in the volatility of the underlying asset, indicating how much the option's price is expected to move per 1% change in volatility.

Standard Deviation

The measure indicating the amount of variation or spread in a set of data points relative to its mean.