Different classes of stock usually are issued to:
A)maintain ownership control by holding the class of stock with greater voting rights.
B)pay less in dividends between the classes of stock.
C)fool investors into thinking that equity is equity and there is no difference in control or value features.
D)extract perquisites without the other class of stockholders knowing.
E)None of the above.

Question

Quizplus · Accepted Answer

Different classes of stock are usually issued to maintain ownership control by holding the class of stock with greater voting rights. This allows the company's founders or management to retain control over key decision-making processes while still raising capital through the sale of shares. Additionally, some classes of stock may have different dividend payouts or other features that make them more or less appealing to different types of investors. This can help to ensure that the company is able to raise capital from a diverse group of investors with varying investment objectives.

Different Classes of Stock Usually Are Issued To