Preferred Stock Is Less Risky for Investors Than Is Common

Multiple Choice

Preferred stock is less risky for investors than is common stock because:

A) Common stock pays dividends as a stated percentage of face value.
B) Common stock has priority over preferred stock with regard to earnings and assets.
C) Preferred dividends are usually cumulative.
D) Preferred stock with no conversion feature has a higher dividend yield than does convertible preferred stock.