Question

In: Finance

6. What type of stock has a limitation on voting rights? 7. What is a contract...

6.

What type of stock has a limitation on voting rights?

7.

What is a contract that results in receiving payments forever (does not have an end date)?

Solutions

Expert Solution

6. a preference share does not carry voting right. A preference share is a type of equity security that has the benefits of both equity and debt. They have the first right to receive dividends and in the event of bankruptcy the common stock holders will receive any funds after the bondholders, creditors and the preference share holders are paid.

And while a superior hand than common stock in dividend an fund payout, generally preference shares doesn’t not have any voting rights.

7. a perpetual contract is a type of contract where the expiry date is not mentioned , it can be for indefinite period of time. And perpetual annuity is a type of annuity where the payments are received for infinite duration. So a individual goes under perpetual contract will not have a end date mentioned and the parties are under contractual relationship for a long period of time.

perpetuity starts with a fixed amount at a certain date. A preferred stock and real estate are the type of investments where the results can be considered as a type of perpetuity.


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