Which of the Following Statements About Preferred Stock Is True

question 4

Multiple Choice

Which of the following statements about preferred stock is true?

• A)Preferred shareholders generally get enhanced voting rights.
• B)Dividends must generally be paid to preferred shareholders before dividends may be paid to common shareholders.
• C)Preferred stocks are a hybrid between equity and debt, because like common stock the owners of preferred shares can vote and like debt they are paid interest.
• D)It would be foolish to purchase the common stock of a company that also issues preferred shares, because the preferred shares have a higher yield with a stronger guarantee.
• E)None of the above are true.

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Definitions:

Labor Costs

The total expenses associated with employing labor, including wages, benefits, and taxes.

Labor Movement

A collective organizational effort aiming to improve workers' rights, conditions, and wages through unions and other labor associations.

Industrialization

The development of industries in a country or region on a wide scale, characterized by the shift from agrarian to industrial modes of production.

Business Representative

An individual who acts on behalf of a business entity in dealings with others, such as negotiations or partnerships.