Which Statement About Retained Profits and Dividends Is True

question 8

Multiple Choice

Which statement about retained profits and dividends is true?

• A) In Australia industrial companies, on average, pay out about 30% of their earnings as dividends.
• B) On average, dividends are a relatively small component of return on shares compared with capital gains.
• C) Dividends and retained profits are two sides of the same coin.
• D) All of the statements are true.

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Definitions:

Equal Variances

An assumption in some statistical tests that the variances in the groups being compared are similar.

Normally Distributed

A symmetric probability distribution centered around the mean, demonstrating that occurrences near the mean happen more often than those at a distance.

Population Variances

A measure of how data points in a population are spread out, indicating the variability of the entire population.

Confidence Interval Estimate

An interval estimate is a range of values used to estimate a population parameter, typically defined by two numbers between which a population parameter is said to lie with a certain level of confidence.