The Most Important Feature of the Preemptive Right Is That

question 12

Multiple Choice

The most important feature of the preemptive right is that the rights

• A)may be sold for profit.
• B)afford stockholders possible protection against dilution.
• C)may be cumulatively voted.
• D)are nontransferable.

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Definitions:

Substitution Effect

The economic principle that as the price of a good increases, consumers will replace it with less expensive alternatives.

Normal Good

A product that sees an increase in demand as people's incomes increase, and a decrease in demand when their incomes decrease.

Housing

Refers to the provision and availability of homes and buildings for habitation by individuals and families.

Utility

A measure of satisfaction or happiness that a consumer derives from the consumption of goods and services.