Question 17

Which one of the following statements is not true about preferred stock?

Group of answer choices

Preferred stock is a hybrid security sharing features of both bonds and common stock.

Preferred shareholders dividends are paid before any dividends are paid to common shareholders.

Preferred shareholders receive preferential treatment over bondholders in a liquidation.

Preferred shareholders generally receive a fixed dividend payment in perpetuity.

Companies can omit preferred dividend payments without fear of pushing the firm into bankruptcy.