Question

Peter owns 100 shares of a company. He receives a fixed rate of dividend from these shares. Which type of share has Peter purchased?
A.
equity shares
B.
preference shares
C.
ordinary shares
D.
priority shares
E.
investment security​

Answer 1

Answer:

B.  preference shares

Explanation:

Option A is wrong because equity shares provide a different rate of dividends to a shareholder. Equity shares are known as ordinary shares. Therefore, option C is wrong.

There are no priority shares in the components of stockholders' equity. Hence option D is wrong.

Investment security​ does not give any dividends. So option E is wrong.

Option B is correct because preference shares give a fixed rate of dividend.