BUSINESS ADMINISTRATION
BUSINESS MATHEMATICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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All of the following are characteristics of preference shares except:
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They are either callable or putable
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They generally do not have voting rights
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They do not share in the operating performance of the company
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Explanation:
Detailed explanation-1: -Features of Preference Shares Preferential dividend option for shareholders. Preference shareholders do not have the right to vote. Shareholders have a right to claim the assets in case of a wind up of the company. Fixed dividend payout for shareholders, irrespective of profit earned.
Detailed explanation-2: -Callable preferred stock is a type of preferred stock that the issuer has the right to call in or redeem at a pre-set price after a defined date.
Detailed explanation-3: -The four main types of preference shares are callable shares, convertible shares, cumulative shares, and participatory shares. Each type of preferred share has unique features that may benefit either the shareholder or the issuer.
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