Most fiRms Are Reluctant to _____ Because of the Associated

question 23

Multiple Choice

Most firms are reluctant to _____ because of the associated implications concerning the firm.

• A) Pay a special dividend.
• B) Reduce a regular cash dividend.
• C) Pay a liquidating dividend.
• D) Pay an extra dividend.
• E) Increase a cash dividend.

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Definitions:

Issuing Corporation

The entity that offers securities for sale to investors, typically through the process of a public offering.

Secondary Market

A venue where investors buy and sell securities they already own, such as the stock market, separate from the primary market where securities are first issued.

Securities

Financial instruments that represent an ownership position in a publicly-traded corporation, a creditor relationship with a governmental body or a corporation, or rights to ownership as represented by an option.

Primary Market

The financial market where new securities are sold to initial buyers directly by the issuer, often through underwriting.