Which of the Following Would Be Most Likely to Lead

question 7

Multiple Choice

Which of the following would be most likely to lead to a decrease in a firm's dividend payout ratio?

• A) Its access to the capital markets increases.
• B) Its R&D efforts pay off, and it now has more high-return investment opportunities.
• C) Its accounts receivable decrease due to a change in its credit policy.
• D) Its stock price has increased over the last year by a greater percentage than the increase in the broad stock market averages.
• E) Its earnings become more stable.

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Definitions:

Median

The middle value in a sorted list of numbers, dividing the data set into two halves.

Trimmed Mean

This is a method of averaging that involves removing a certain percentage of the largest and smallest values before calculating the mean.

Bootstrap Confidence Intervals

A statistical technique that involves resampling with replacement to estimate the distribution of an estimator and compute its confidence intervals.

Small Samples

Refers to a group or set in a study that is limited in number, which may affect the statistical significance and generalizations.