A fiRm Can Make It Easier for an Investor to Create

question 85

Multiple Choice

A firm can make it easier for an investor to create a homemade dividend policy if the firm:

• A) Offers an automated dividend reinvestment plan.
• B) Uses the residual dividend approach.
• C) Pays a regular cash dividend.
• D) Completes a stock split.
• E) Pursues a compromise dividend policy.

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Definitions:

Good Faith

The honest intention to act without taking an unfair advantage over another party in a transaction.

Reasonable Commercial Standards

The accepted norms and practices within a particular industry or trade that are considered to be fair and appropriate.

Demand Instrument

A demand instrument is a financial document that requires payment of a specified sum of money immediately upon demand or within a short time frame.

Overdue

Refers to something being past its expected or scheduled time, often used in the context of payments or tasks.