Which of the Following Is Not an Example of Market

question 68

Multiple Choice

Which of the following is not an example of market imperfections that make dividend policy relevant?

• A)institutional restrictions on stock holdings
• B)differences in dividend-payout ratios
• C)transaction costs such as brokerage fees
• D)differences among investors in marginal tax rates

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Definitions:

Current Liabilities

Short-term financial obligations that are due within one year or within the normal operating cycle.

Cash Flows

The aggregate sum of funds moving in and out of a company, particularly influencing its ability to cover short-term obligations.

Indirect Method

A technique used in cash flow statements to adjust net income for changes in non-cash items to calculate net cash from operating activities.

Statement of Cash Flows

This report details the fluctuations in balance sheet accounts and how income influences cash and cash equivalents, categorizing these changes into operating, investing, and financing sections.