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All of the following are common stock characteristics, EXCEPT: Dividends are not a liability of the firm until declared. Stockholders have no legal recourse if

All of the following are common stock characteristics, EXCEPT:

Dividends are not a liability of the firm until declared. Stockholders have no legal recourse if dividends are not declared

No exception, all listed are common equity characteristics

Ownership interest

Common stockholders vote to elect the board of directors and on other issues

Dividends are tax deductible (each $1 in dividends reduces the taxable income

by $1)

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