Series 6 - Investment Company And Variable Contracts Products Representative Exam

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If a preferred stock is described as DEF 4% participating to 8%, the company could pay its holders how much in additional dividends in profitable years, if the board so declares?

4%
A
8%
B
12%
C
2%
D

Explanations

The rate of participating dividend is the difference between the stated fixed rate and the participating rate. In this case, that is 4%.

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