Which of the Following Is NOT True About the Life-Cycle

question 42

Multiple Choice

Which of the following is NOT true about the life-cycle growth and dividend policy?

• A) In the maturity stage, a firm usually pays moderate to high dividends.
• B) In the development stage, a firm usually pays stock dividends and some low cash dividends.
• C) In the expansion stage, a firm pays low to moderate cash dividends and occasionally may have stock splits.
• D) In the growth stage, a firm pays stock dividends.

---

Definitions:

Capital Goods

Physical assets used by businesses to produce goods and services, such as machinery, buildings, and equipment.

Consumer Goods

Products produced for purchase by individuals and households for personal use, such as clothing, food, and electronics.

Industrialize

The process by which an economy is transformed from primarily agricultural to one based on the manufacturing of goods.

Market-Oriented Economy

An economy in which decisions regarding investment, production, and distribution are based on supply and demand, and prices of goods and services are determined in a free price system.