9.1

1. Rights and privileges of common stockholders Larry Neison holds 1,000 shares of General Electric (GE) common stock. As a stockholder, he has the right to be involved in the election of its directors, who are responsible for managing the company and achleving the company's objectives. True or False: Larry will receive dividends after preferred stockholders. True False Larry also holds 2,000 shares of common stock in a company that only has 20,000 shares outstanding. The company's stock currently is valued at 542.00 per share. The company needs to raise new capital to invest in production. The company is looking to issue 5,000 new shares at a price of $33.60 per share. Larry worries about the value of his investment. Larry's current investment in the company is If the company issues new shares and Larry makes no additional purchase, Larry's investment will be worth This scenario is an example of Larry could be protected if the firm's corporate charter includes a provision. If Larry exercises the provisions in the corporate charter to protect his stake, his investment value in the firm will become