When a Firm Chooses a Constant Long-Term Payout Ratio Its

question 38

Multiple Choice

When a firm chooses a constant long-term payout ratio its dividend policy, that ratio is known as its ________________________. ​

• A)Target payout ratio​
• B)Stable dividend per share​
• C)Regular dividend​
• D)Special payout policy​

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Definitions:

Total Profits

The final financial gain from a business operation after subtracting all expenses, taxes, and costs from total revenues.

Firm

A business organization, such as a corporation or partnership, engaged in commercial, industrial, or professional activities.

Accounting Profits

The net income for a company calculated by subtracting total expenses from total revenues, according to standard accounting practices.

Economic Profits

The gap between a company's overall income and its combined explicit and implicit expenses.