Which of the Following Is an Advantage of Preference Shares

question 40

Multiple Choice

Which of the following is an advantage of preference shares?

• A)Preference shareholders may sell their shares for a price higher than that of ordinary shares.
• B)Preference shareholders have higher voting rights than ordinary shareholders.
• C)Preference shareholders have the first claim on dividend funds.
• D)Preference shareholders are guaranteed that they will not take a loss on their investment.

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Definitions:

Legal Claim

is a right to seek a remedy or relief in a legal action due to the infringement of one's legal rights.

Forbearance to Sue

An agreement between a creditor and a debtor in which the creditor agrees not to sue the debtor for a specified period of time.

Statute of Limitations

A law that sets the maximum period one can wait before filing a lawsuit, depending on the type of case or claim.

Consideration

The value (such as money, services, or goods) that is exchanged between parties in a contract, serving as the essential reason for a party entering into a legal agreement.