SIE practice questioneasyCallable Preferred Stock
A company may redeem (buy back) callable preferred stock:
- AAt its discretion after a specific date✓ Correct answer
- BOnly with shareholder approval
- CFor more than the call price
- DOnly by issuing more common shares
Explanation
Why A — At its discretion after a specific date
Callable preferred can be redeemed by the company after a call date. Shareholder approval is not typically needed, redemption is at or below the call price, and more shares need not be issued.
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