Question

Which statement is NOT true about equity shareholders?

A: They are owners of the business.

B: They are given first priority while paying dividends.

C: They have a right to vote on business matters.

D: They receive dividend only if the business makes profits.

E: They hold ordinary shares and not preference shares.

Answer 1

read B & E closely

Answer 2

OK

Answer 3

Which one you thank it is

Answer 4

you first!!

Answer 5

remembering pref shares are like special shares in one sense

Answer 6

b

Answer 7

i would agree

pref shareholders get paid before normal equity but they have limited right to dividends, usually a fixed coupon, and often limited voting rights

Answer 8

so its c

Answer 9

C is ambiguous

they have votes that pertain to the business, eg remuneration for board. but they meet once a year and are not involved in day to day decisions.

so C is partly true but mostly not true

B however is not true if there are other types of equity holders, such as prefs who get paid first.

not a very well worded question