Different classes of stock usually are issued to:
A)allow a certain group to maintain ownership control while reducing that group's equity position.
B)reduce the firm's dividend obligation.
C)fool investors.
D)extract perquisites from one class of shareholders without the other class of shareholders knowing.
E)distinguish the time periods in which the various shares were issued.

Question

Quizplus · Accepted Answer

Different classes of stock are often issued to allow a certain group, such as founders or insiders, to maintain ownership control while reducing their equity position. This can be done by giving a certain class of stock more voting rights than others. It is not intended to fool investors, extract perquisites, or distinguish time periods of issuance.

Different Classes of Stock Usually Are Issued To