Corporations that invest surplus funds in floating-rate preferred stock benefit from getting a relatively stable price,which is desirable for liquidity portfolios,and they also benefit from the 70% tax exemption on preferred dividends received.

Question

Quizplus · Accepted Answer

Corporations do benefit from getting a relatively stable price when investing in floating-rate preferred stock, which makes it desirable for liquidity portfolios, and they also benefit from the 70% tax exemption on the preferred dividends received.

Corporations That Invest Surplus Funds in Floating-Rate Preferred Stock Benefit