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  3. Study Set
    Financial Management Theory Study Set 2
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    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 20

Question 20

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 70% tax exemption on preferred dividends received.

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