Which of the Following Is True About the Payment of Dividends

question 39

Multiple Choice

Which of the following is true about the payment of dividends by a firm?

• A)Dividends are paid only to the bondholders of the firm.
• B)Common stockholders have priority over preferred stockholders with regard to dividend payments.
• C)Preferred stocks pay accumulated dividends only once i.e. at the time of maturity.
• D)Growth stocks pay little or no dividends; rather, the firms retain most of their earnings each year to reinvest in assets.
• E)Common stockholders generally receive a fixed amount of dividend every year.

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Definitions:

Terminal Moraine

Glacially carried sediment that accumulates at the terminus (end) of a glacier and a landform composed of such material; generally marks the glacier’s farthest downhill extent.

Recessional Moraine

A moraine that forms as the front of a glacier melts back and stagnates for some time in one location, depositing a pile of sediment.

Sediment

Particulate matter that accumulates in layers on the Earth's surface, deposited by water, wind, ice, or biological activity.

Esker

A long, winding ridge of stratified sand and gravel, deposited by meltwater from a retreating glacier or ice sheet.