Due to its risk characteristics compared to the ordinary preferred stock, cumalitive preferred should present a ____ expected return.

Due to its risk characteristics compared to the ordinary preferred stock, cumulative preferred should present a lower expected return.

Reason

 As the cumulative feature of preferred stock reduces the dividend risk to investors, cumulative preferred stock can usually be offered with  a lower payment rate than required for a non cumulative preferred stock.  Due to this lower cost of capital, most companies preferred stock offerings are issued with cumulative feature.