1. Preferred stock offers the issuing corporation and investors advantages and disadvatnages. Which of the following statements describes a disadvatage for the issuer of preferred stock? a. The after-tax cost of preferred stock is higher than the afer-tax cost of debt b. Nonconvertible preferred stock helps prevent the dilution of common equity. 2. Firms that invest in companites' preferred stock may exclude 70% of their preferred divident income from taxes. TRUE or FALSE?