Which One of These Statements Is True

question 70

Multiple Choice

Which one of these statements is true?

• A)Managers tend to benefit more from decreasing a firm's size rather than increasing its size.
• B)Dividend payout policies are always set according to the best interest of the shareholders.
• C)Acquisitions are generally believed to be an excellent alternative to dividends.
• D)The IRS code discourages the accumulation of surplus cash thereby encouraging dividends.
• E)Current tax law favors dividends over repurchases from the stockholders' point of view.

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Definitions:

Jefferson Davis

The President of the Confederate States of America during the American Civil War, from 1861 to 1865.

Greenback

A term historically used to refer to paper money issued by the United States during the Civil War.

Civil War-Era

A period surrounding the American Civil War (1861–1865), characterized by significant political, social, and military upheavals in the United States.

Paper Money

Currency in the form of banknotes, which has no intrinsic value but is used as a medium of exchange, authorized and supported by a government.