Which of the Following Is NOT a Characteristic of Preferred

question 24

Multiple Choice

Which of the following is NOT a characteristic of preferred stock as an investment?

• A)Preferred stockholders are entitled to receive their dividend prior to payment of dividends to common stockholders
• B)Preferred stock dividends are taxed at the capital gains rate for individual investors
• C)Preferred stock dividends may be omitted by the corporation under certain circumstances
• D)It is a hybrid security of common stock and debt

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