Which of the Following Statements Is Most Correct

question 6

Multiple Choice

Which of the following statements is most correct?

• A) The tax preference hypothesis suggests that companies can reduce their costs of capital by increasing their dividend payout ratios.
• B) One advantage of the residual distribution policy (with all distributions as dividends) is that it leads to a stable dividend payout, which is desired by investors.
• C) Firms with a large number of investment opportunities and a relatively small amount of cash tend to have above average dividend payouts.
• D) Answers a and b are correct.
• E) None of the answers above is correct.

---

Definitions:

High Performance

Achieving significantly better outcomes or efficiency than what is considered standard.

Noble Cause

A goal or principle considered to be morally righteous and worthy of pursuit.

Inspire Workers

To motivate and uplift employees or team members, encouraging them to achieve their best performance and reach their full potential.

Barrier Buster

Individuals or policies that identify and remove obstacles to streamline processes or facilitate easier access to resources or information.