Market Imperfections May Make the Choice Between Dividends and Repurchases

question 86

Multiple Choice

Market imperfections may make the choice between dividends and repurchases relevant.Which of the following is not one of these imperfections?

• A) Institutional restrictions on stock holdings
• B) Differences in dividend-payout ratios
• C) Taxes on dividends and capital gains
• D) Differences among investors in marginal tax rates

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Definitions:

Decreases

A reduction in the quantity, size, or value of something.

Notes Payable

A written agreement or promissory note to pay a certain sum of money, usually with interest, by a specific date.

Salaries Expense

Represents the total amount of gross wages paid by a business to its employees over a specific period, typically before any deductions.

Chronological Order

The arrangement of events, documents, or records in the sequence of their occurrence.