Stock that typically includes preference for receiving dividends and for distribution of corporate assets during a liquidation is called preferred stock.
What is preferred stock?
Preferred stock is a type of stock that offers different rights to shareholders than common stock. Preferred stock holders receive regular dividends.
The above means that preferred stockholders in a corporation have a priority claim on the company's assets in terms of distribution during liquidation.
Hence, stock that typically includes preference for receiving dividends and for distribution of corporate assets during a liquidation is called preferred stock.
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