1.How does a preemptive right protect the interests of existing stockholders?
2.Explain why warrants are rarely exercised unless the time to maturity is small? .
3.Under what circumstances is a warrant’s value high? Explain.
4.Explain the role of cash and of earnings when a corporation is deciding how much, if any, cash dividends to pay to common stockholders.
5.Are there any legal factors that could restrict a corporation in its attempt to pay cash dividends to common stockholders? Explain.