How many of the following statements, relating to ordinary shareholders, are true?
$\bullet$Ordinary shareholders generally have greater risks than preference shareholders.
$\bullet$Ordinary shareholders are the last to receive a distribution if the company is wound up.
$\bullet$Ordinary shareholders have a greater opportunity for gain if the company is profitable than preference shareholders.
$\bullet$Ordinary shareholders have the right to vote at meetings of the company.

Question

Quizplus · Accepted Answer

All four statements are true. Ordinary shareholders have greater risks than preference shareholders because they are the last to receive payments and dividends if the company cannot meet its obligations. They are also the last to receive payment if the company is wound up, which means that preference shareholders and other creditors will have already received their payments. Ordinary shareholders have the opportunity for greater gains if the company is profitable because they typically receive a proportionally higher dividend or share in the profits. Finally, ordinary shareholders have the right to vote at meetings of the company, which gives them a say in the management and strategy of the company.

How Many of the Following Statements, Relating to Ordinary Shareholders ∙\bullet∙

How Many of the Following Statements, Relating to Ordinary Shareholders $\bullet$