The redemption privilege on preferred shares provides that the preferred shareholders can:

Question

Quizplus · Accepted Answer

The redemption privilege on preferred shares allows preferred shareholders to turn in their shares for a specified cash price. This gives the shareholders the ability to "cash out" their investment if they want, which can be attractive if they think the market price of the shares will decrease or if they need the liquidity for other purposes. Options A and B are not correct because they describe different types of privileges that are not related to redemption. Option D is not correct because it describes a conversion privilege, not a redemption privilege.

The Redemption Privilege on Preferred Shares Provides That the Preferred