Asked by Donald R. Johnson on May 19, 2024
Verified
Common stockholders and preferred stockholders benefit when the market price of the stock increases.
Common Stockholders
Individuals or entities that own common shares in a corporation, entitling them to vote and share in the profits.
Preferred Stockholders
Individuals or entities that own preferred shares in a company, granting them certain advantages over common stockholders, such as priority in dividend payments and assets during liquidation.
Market Price
The current price at which an asset or service is bought or sold in the open market.
- Gain an understanding of a company’s financial framework, focusing on stock ownership and the generation of funds.
Verified Answer
LM
Laken MitchellMay 26, 2024
Final Answer :
True
Explanation :
Both common and preferred stockholders can benefit from an increase in the market price of the stock, as it represents an increase in the value of their investment.
Learning Objectives
- Gain an understanding of a company’s financial framework, focusing on stock ownership and the generation of funds.