In a joint-stock company, preference shareholders are those who receive?

A. high dividends when profits are high and little or nothing when profits are low
B. a fixed rate of dividend and have the first claim on the net profits of the company
C. the remaining profits after all other shareholders have been paid
D. dividends quarterly when others receive annually

Correct Answer:

Option B – a fixed rate of dividend and have the first claim on the net profits of the company