One common reason for issuing two distinct classes of common

One common reason for issuing two distinct classes of common stock is to:

A. Sell different classes to increase profits

B. Allow one stock to increase in price while other class declines

C. Restrict voting privileges for some shareholders

D. Conserve cash by offering dividends to only one class of stockholders

Solution

voting rights of stocks are usually based on the class of shares. These classes are Class A and so on. Class A will have more higher voting preference and more voting rights.

Hence, correct option is C. Restrict voting privileges for some shareholders.