20.9k views
2 votes
Corporations that invest surplus funds in floating-rate preferred stock benefit from getting a relatively stable price, which is desirable for liquidity portfolios, and they also benefit from the 70% tax exemption on preferred dividends received.

A.True
B.False

1 Answer

7 votes

Final answer:

Corporations benefit from stable prices and tax exemptions when investing in floating-rate preferred stock.

Step-by-step explanation:

Corporations that invest surplus funds in floating-rate preferred stock benefit from getting a relatively stable price, which is desirable for liquidity portfolios, and they also benefit from the 70% tax exemption on preferred dividends received. Therefore, the statement that corporations benefit from stable prices and tax exemptions when investing in floating-rate preferred stock is true.

User Jason Stokes
by
8.1k points
Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.

9.4m questions

12.2m answers

Categories