A buyer is not obligated to accept conforming goods and to pay for them according to the contract terms

What is the significance of the term "preferred" in reference to preferred stock?

A) Preferred stockholders receive preference over creditors of the corporation in the event of liquidation. B) Preferred stockholders receive certain preferences over common stockholders with respect to dividends or with respect to assets in the event of liquidation. C) It is viewed to generally be a better investment than common stock. D) Only shareholders owning a certain minimum amount of common stock are entitled to purchase preferred stock. E) Preferred stockholders usually have better voting rights than common stockholders.

Taylor Tobacco Company is concerned that the company may be held liable in a court of law and ordered to pay a large damage award to a smoker harmed by the company's cigarettes. The characteristics of the judicial system that increase the frequency and severity of loss are known as

A) moral hazard. B) particular risk. C) speculative risk. D) legal hazard.