The Amount of Dividend That Can Be Paid to Shareholders

question 41

Multiple Choice

The amount of dividend that can be paid to shareholders:

• A)depends on how profitable a business is and on the current assets of the business.
• B)is limited to the amount of current period profits.
• C)is limited to the amount of current period profits and accumulated profits.
• D)is limited to the amount of current period profits,accumulated profits and paid up capital.

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Definitions:

Consumer Surplus

The variance between the aggregate sum consumers are prepared and able to spend on a good or service versus what they truly pay.

Consumer Surplus

The divergence between the full amount consumers intend and are able to allocate for a good or service, and the amount they really pay.

Total Utility

The complete fulfillment derived from the consumption of a specific amount of products or services.

Consumer Surplus

The gap between the total price consumers are willing and able to shell out for a good or service and the amount they really pay.