Which of the following is typically a feature of common stock?
A. Common stocks have a maturity value.
B. Common stocks may or may not pay dividends.
C. Most common stocks are callable.
D. Most common stocks are cumulative.
Common and Preferred Stocks:
There are similarities and differences between common and preferred stocks. For example, upon liquidation of the company, preferred stockholders are given the first preference (after creditors) to assets as compared to common stockholders. However, both common and preferred stocks provide an equity stake in the company.
Answer and Explanation: 1
The correct answer is Option (B) Common stocks may or may not pay dividends.
This is typically a feature of common stocks. It is not...
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fromChapter 11 / Lesson 5
Stock is the measure of ownership in a company, existing in common stock and preferred stock which is given priority in several cases. Explore each type of stock to identify the advantages to each.