MM's Assertion That Dividend Policy Will Not Affect the Value

question 28

Multiple Choice

MM's assertion that dividend policy will not affect the value of the firm requires that dividend policy does not:

• A) alter the retained earnings of the firm.
• B) affect investment and borrowing policies.
• C) allow the payout ratio to change.
• D) alter the number of outstanding shares.

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Definitions:

Child Support

Financial contributions required by law to be made by a non-custodial parent to support their child(ren)'s upbringing and welfare.

Remarriage

Entering into marriage again after one or more previous marriages have ended through divorce or widowhood.

Stepparent Roles

The functions and responsibilities adopted by a person who marries a partner with children from a previous relationship.

Nonbiological Mother

A female parent who does not share a genetic relationship with her child, often through adoption, step-parenting, or surrogacy.