Assuming Spot-Futures Parity Holds, an Increase in the Dividend Rate

question 51

Multiple Choice

Assuming spot-futures parity holds, an increase in the dividend rate will ________ the futures price.

• A) increase
• B) decrease
• C) not change
• D) increase or decrease
• E) Insufficient information.

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Definitions:

Biweekly Salaries

Payroll disbursements made to employees every two weeks, totaling twenty-six payments annually.

Fiscal Period

Any designated period of time for accounting purposes, typically a year, used by governments and businesses for financial reporting and budgeting.

Adjusting Entry

A journal entry made at the end of an accounting period to update the accounts and ensure they reflect the true financial position of the business.

Summary of Adjustments

Summary of Adjustments is a document or section within financial statements detailing any adjustments made to initial financial records to ensure their accuracy and alignment with accounting principles.