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Question 2 Preference shareholders can vote to appoint the company's directors. True False

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Question 2
Preference shareholders can vote to appoint the company's directors.
True
False

Question 2 Preference shareholders can vote to appoint the company's directors. True False

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WilliamElite · Tutor for 8 years

Answer

False

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## Step 1:<br />A company's stockholders fall into two main types —ordinary shareholders (or equity shareholders) and preference shareholders. Both these types differ based on the perks they enjoy.<br />## Step 2:<br />Preference shareholders have higher claims on dividends and a company’s assets if it's liquidated. In exchange for these higher claims, preference shareholders typically make some restrictions or compromises. One such limitation is their voting rights.<br />## Step 3:<br />Preference shareholders don't averagely get the right to vote at the company's general meetings or for the election of company directors. These voting rights are preserved for the regular shareholders.
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