The Residual Theory of Dividend Policy Asserts That

question 55

Multiple Choice

The residual theory of dividend policy asserts that

• A)sufficient dividends are paid to maintain a stable total dividend payment-any residual is invested internally by the firm.
• B)sufficient dividends are paid to maintain a stable dividend payout ratio-any residual is invested internally by the firm.
• C)dividends are paid out of the residual remaining after internal investments by the firm.
• D)dividend payments are adjusted to maintain dividends at a constant percentage of total cash flows.

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Definitions:

Anti-Federalists

Opponents of the ratification of the U.S. Constitution in 1787-1788, who favored stronger state governments and feared a too powerful federal government.

Proclamation of 1763

Royal directive issued after the French and Indian War prohibiting settlement, surveys, and land grants west of the Appalachian Mountains; caused considerable resentment among colonists hoping to move west.

Articles of Confederation

The original constitution of the United States, ratified in 1781, which was eventually replaced by the U.S. Constitution in 1789 due to its weakness in central governance.

National Government

A political organization holding sovereign authority over a country, responsible for its administration and law enforcement.