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  3. Study Set
    Financial Management Theory and Practice Study Set 4
  4. Exam
    Exam 20: Hybrid Financing: Preferred Stock, Warrants, and Convertibles
  5. Question
    Corporations That Invest Surplus Funds in Floating-Rate Preferred Stock Benefit
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Corporations That Invest Surplus Funds in Floating-Rate Preferred Stock Benefit

Question 19

Question 19

True/False

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 50% tax exemption on preferred dividends received.

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