A Preference Share Issue Offers All of the Following Advantages

question 61

Multiple Choice

A preference share issue offers all of the following advantages to a company except:

• A) a flexible dividend policy.
• B) fixed interest borrowings that can count as equity.
• C) extension of the equity base of the company.
• D) an indefinite maturity.

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Definitions:

Valid Inferences

Reasonable conclusions or judgments drawn from evidence and reasoning rather than explicit statements.

Validity

The extent to which a concept, conclusion, or measurement is well-founded and likely corresponds accurately to the real world.

Conjunction

The combination of two or more events, conditions, or propositions, typically expressed in logic and mathematics.

Symbolic Logic

A branch of logic that uses symbols to express logical representation and reasoning.