Top-Down Budgeting Is

question 30

Multiple Choice

Top-down budgeting is:

• A)when the local managers impose a budget on the top management.
• B)when top management sets the budget and imposes it on lower levels of the organization.
• C)when customers impose a budget on top management of the company.
• D)when top management imposes a budget on the board of directors.

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Definitions:

Annual Dividend

The total dividend payment a company makes to its shareholders in a single year.

Dividends

Payments made by a corporation to its shareholder members, distributing a portion of the company's earnings.

Cost of Equity

The return a company requires to decide if an investment meets capital return requirements and can be seen as the opportunity cost of investing capital elsewhere.

Dividend Growth Model

A model used to estimate the value of a dividend-paying stock, based on the assumption that dividends will continue to grow at a constant rate.