Quiz Ch 14 – Stock Split Outcome
Fundamentals of Financial Management, Concise
Brigham and Houston
09th Edition
After a 2-for-1 stock split for Troll Brothers’ stock, which outcome is likely for your position?
Quiz Ch 14 – T/F Comparative Conceptual Impact of 100% Stock Dividend and 2:1 Stock Split on Stock Price
Fundamentals of Financial Management, Concise
Brigham and Houston
09th Edition
True or false: In conceptual terms, a 100% stock dividend and a 2:1 stock split are expected to yield equivalent impacts on the firm’s stock price.
Quiz Ch 14 – T/F Dividend Irrelevance Theory: Impact on Cost of Capital and Stock Price
Fundamentals of Financial Management, Concise
Brigham and Houston
09th Edition
True or false: Miller and Modigliani’s theory of dividend irrelevance posits that the proportion of earnings a company distributes as dividends holds no influence over its cost of capital, yet it does impact its stock price.
Quiz Ch 14 – T/F Effects of a “Reverse Split” on Outstanding Shares
Fundamentals of Financial Management, Concise
Brigham and Houston
09th Edition
True or false: A “reverse split” leads to a reduction in the total outstanding shares.
Quiz Ch 14 – T/F Miller and Modigliani’s Dividend Irrelevance Theory
Fundamentals of Financial Management, Concise
Brigham and Houston
09th Edition
True or false: Miller and Modigliani’s theory states that a firm’s dividend payout ratio has no impact on its cost of capital or stock price.
Quiz Ch 14 – T/F Optimal Distribution Policy for Stock Price
Fundamentals of Financial Management, Concise
Brigham and Houston
09th Edition
True or false: The best distribution policy balances dividends and capital gains to maximize the firm’s stock price.
Quiz Ch 14 – T/F Payout Ratio Strategy for Investor Preference and Stock Price Maximization
Fundamentals of Financial Management, Concise
Brigham and Houston
09th Edition
True or false: Should a firm aim to maximize its stock price while catering to investor preference for high earnings retention, it would be advisable to maintain a low payout ratio.
Quiz Ch 14 – T/F Target Payout Ratio and Expected Growth
Fundamentals of Financial Management, Concise
Brigham and Houston
09th Edition
True or false: Assuming other factors remain consistent, a firm’s elevated target payout ratio should correspond to a higher expected growth rate.