In Theory, Firms Should Only Pay Dividends If the Company

question 12

True/False

In theory, firms should only pay dividends if the company has excess cash not needed for expansion, capital expenditures, or repayment of debt.

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Definitions:

Trespass to Personal Property

The unlawful taking or harming of another’s personal property; interference with another’s right to the exclusive possession of his or her personal property.

Conversion

The act of wrongfully taking or retaining a person’s personal property and placing it in the service of another.

Wrongful Interference

A legal term referring to the act of intentionally interfering with contractual or business relationships.

Business Relationship

A connection between two or more parties engaged in commercial transactions or activities, based on contractual, statutory, or recognized ethical obligations.