Which One of the Following Is a Drawback of Cash

question 90

Multiple Choice

Which one of the following is a drawback of cash dividends?

• A)Firms may have to obtain additional external financing which would not be required in the absence of the dividends.
• B)Stock prices tend to increase as annual dividend amounts increase.
• C)Cash dividends support stock prices.
• D)Dividends tend to lower agency costs.
• E)Dividend-paying firms tend to attract a wider field of investors than do non-dividend-paying firms.

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Popular Rights

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