Series 7 Exam Question 336: Answer and Explanation

Question: 336

All the following securities may pay a dividend EXCEPT

• A. warrants
• B. common stock
• C. American depositary receipts (ADRs)
• D. participating preferred stock

Correct Answer: A

Explanation:

A. The correct answer is Choice (A). Because warrants are basically long-term options to buy stock at a fixed price from the issuer, they can't pay dividends.