Stock rights provide the stockholder with ________.
A) the right to purchase additional shares in direct proportion to their number of owned shares
B) the right to elect the board of directors
C) cumulative voting privileges over the preference stockholders
D) the opportunity to receive extraordinary earnings

Question

Quizplus · Accepted Answer

Stock rights allow the stockholder to purchase additional shares in direct proportion to the number of shares already owned. This is known as a "rights offering" and is typically offered at a discounted price to existing shareholders. The other options are not associated with stock rights.

Stock Rights Provide the Stockholder with ________