Which Is a Characteristic of the Price of Preferred Stock

question 47

Multiple Choice

Which is a characteristic of the price of preferred stock?

• A)Since preferred stock dividends are fixed, they are tax-deductible.
• B)Because preferred stock has no maturity, the price analysis is similar to that of debt.
• C)Preferred stock is valued as a perpetuity.
• D)None of these options

---

Definitions:

Persons

Human beings as individuals or considered collectively, especially in a legal or formal context.

Capital Account

An account used to track the investments made into a company by its owners, plus the retained earnings of the business.

Withdrawal Account

An account used in partnership accounting to record the amounts drawn out of the business by the partners for personal use.

Relative Ease

The level of simplicity or difficulty with which a task can be completed when compared to other tasks.