Answer for Chapter 12 Case Study #1

Each kind of stock has its advantages and disadvantages.  If Miss Hester seeks a stock through which she will be able to participate in a corporation's stockholder meetings, she will buy common stock which has voting rights.  If Miss Hester desires only an income she may want to buy preferred stock which is assured of participating in dividends before common stock does.  If Miss Hester is seeking a stock that will increase in value, she should check what has been happening to the value of various common and preferred stocks.  Before deciding to invest in stock, Miss Hester would be wise to consult with a specialist in the stock market.