The Fact That Flotation Costs Can Be Significant Is an Argument

question 89

Multiple Choice

The fact that flotation costs can be significant is an argument for:
The fact that flotation costs can be significant is an argument for:

• A) a firm to issue larger dividends than its closest competitors.
• B) a firm to maintain a constant dividend policy even if it frequently has to issue new
• C) shares.
• D) maintaining a constant dividend policy even when profits decline significantly.
• E) maintaining a high dividend policy.
• F) maintaining a low dividend policy and rarely issuing extra dividends.

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Definitions:

Economic System

An organized arrangement for producing, distributing, and consuming goods.

Centralized Location

A position or place that serves as the central point for distribution or coordination of activities and services.

Formal Rules

Explicitly stated guidelines and laws that govern behavior and procedures within organizations or societies.

Conduct

The manner in which a person behaves, especially within a particular context or environment.