Why Would an Investor Favor a Common Share Over a Preferred

question 110

Multiple Choice

Why would an investor favor a common share over a preferred share?

• A)To obtain a bigger potential capital gain.
• B)To obtain repayment of the face value at maturity.
• C)To obtain a fixed dividend.
• D)To obtain a fixed coupon payment.
• E)To obtain a variable dividend

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Definitions:

Government Assistance

Programs or financial aid provided by the government to individuals, businesses, or other entities in need of support.

Deferred Gratification

The ability to resist the temptation for an immediate reward and wait for a later reward.

Paycheque

A paycheque is a check issued by an employer to pay an employee for services rendered, typically on a regular basis like weekly or monthly.

Savings Account

A deposit account held at a bank or other financial institution that provides modest interest rates.