Similar to bond investments, preferred shares can be ________, meaning the firm may buy them back.


A. cumulative
B. callable
C. responsive
D. retroactive

Respuesta :

Answer:

B. callable

Explanation:

Preferred shares and bonds can be callable. This means that the issuing company has a right to buy back the bond before it maturity or the preferred share at a predetermined price.Usually, it is a requirement that the the issuer offers a higher price than the par value of the stock or bond. The holders receive dividends or coupons regularly. Municipal bonds are commonly known to have callable features.