Which of the Following Is Not True

question 16

Multiple Choice

Which of the following is not true?

• A)All corporations must issue common stock.
• B)Common shareholders have a claim on the assets of a firm after creditors and preferred shareholders have received amounts promised to them.
• C)Frequently, corporations grant voting rights only to common shares, giving their holders the right to elect members of the board of directors and to decide certain broad corporate policies (spelled out in the stock contract).
• D)Some firms issue more than one class of common shares, with each class granted different voting rights.
• E)Firms generally issue preferred shares, both at the time of initial incorporation and in subsequent years, for amounts greater than par (or stated) value.