Which of the Following Statements About Dividends Is Correct

question 237

Multiple Choice

Which of the following statements about dividends is correct?

• A)Companies sometimes issue stock dividends to lower the market price per share of stock.
• B)Stock dividends immediately increase the total value of the stockholders' investment.
• C)Cash dividends and stock dividends both decrease total stockholders' equity.
• D)A corporation has a legal obligation to pay dividends each year.

---

Definitions:

Applied Research

It is a form of systematic inquiry involving the practical application of science. It is used for solving problems and inventing new processes and products.

Resource Productivity

The measure of how effectively economic resources are used to produce goods and services.

Immediate Payoff

The immediate benefits or rewards derived from a particular action or decision.

Basic Research

Research conducted to increase fundamental knowledge and understanding, without a specific practical aim or application.