Which best describes the difference between preferred and common stocks Preferred stock allows shareholders to vote for a board of directors while shareholders of common stock do not have voting right?

The statement is incorrect; preferred stockholders typically do not have voting rights, while common stockholders do. The main difference between the two is that preferred stock generally provides fixed dividends and has priority over common stock in asset liquidation, but common stockholders have voting rights and the potential for higher returns through capital appreciation. Preferred stock is often seen as a hybrid between equity and debt.