Which of the Following Can Be a Benefit of the Clientele

question 37

Multiple Choice

Which of the following can be a benefit of the clientele effect?

• A) New investors who were previously uninterested in the stock may be attracted to it because of a policy change.
• B) If firms change their dividend policy, the investors who desire the previous policy will sell their shares.
• C) If the firms change their dividend policy, the investors will be unaffected by the change due to the dividend irrelevance theorem.
• D) If the firms change their dividend policy, it will maximize shareholder wealth.

---

Definitions:

Least Risky Strategy

describes the approach or plan of action that exposes an entity to the minimal amount of risk or potential for loss.

Rapidly Aging Population

A demographic trend where the median age in a population increases significantly due to rising life expectancy and/or declining birth rates.

One-Child Policy

A former Chinese government policy aimed at controlling the population by limiting families to having only one child.

Global Expansion

The strategy of a business to enter and compete in international markets, broadening its geographic footprint and customer base.