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The Reason Corporations Give the Preemptive Right to Stockholders Is

Question 11

Multiple Choice

The reason corporations give the preemptive right to stockholders is to


A) allow them to maintain their percentage interest in the firm.
B) reduce the dividend payments to the common stockholders.
C) entice them into buying more shares of stock.
D) keep control of the company within a small number of investors.

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