Quiz Ch 16 – T/F Long-Term Target Dividend Payout Ratios in Firms
Principles of Corporate Finance
Brealey, Myers, and Allen
13th Edition
True or false: It is common for firms to define long-term target dividend payout ratios.
True or false: It is common for firms to define long-term target dividend payout ratios.
True or false: Managers exercise caution when contemplating dividend changes that might require reversal.
True or false: Miller and Modigliani’s dividend irrelevance assumes market efficiency.
True or false: Opting for stock dividends is an equivalent choice to distributing cash dividends.
True or false: While similar to bumper dividends, stock repurchases do NOT serve as a direct replacement for regular cash dividends.
True or false: Numerous companies implement automatic dividend reinvestment plans (DRIPs).
How does the heavier taxation of dividends compared to capital gains influence investor preferences in terms of stock valuation and dividend yields?
Which investor category is most strongly motivated by tax considerations to prioritize dividends over capital gains?
Why might shareholders frequently demand higher dividends?