A corporation can issue new common stock directly to existing stockholders through a:
A) Warrant.
B) Preemptive rights offering.
C) Initial public offering.
D) Leveraged buyout.
E) None of the above.

Question

Quizplus · Accepted Answer

Preemptive rights offering allows existing shareholders the opportunity to buy new shares before the corporation offers them to the general public, thus maintaining their proportional ownership in the company.

A Corporation Can Issue New Common Stock Directly to Existing