Which of the Following Statements Is True Regarding Trading and Transactions

question 100

Multiple Choice

Which of the following statements is true regarding trading and transactions costs?

• A) As long as share issues are costless, investors are indifferent about whether to receive returns in the form of capital gains or as cash dividends on shares.
• B) If issuing securities entails large costs, both corporations and stockholders should prefer a full-retention strategy regarding dividends.
• C) If investors find creating homemade dividends too costly, they would not be willing to pay a premium for stocks that habitually pay dividends.
• D) All of the above statements are true.
• E) Only statements (a) and (b) are true.

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Definitions:

Procedural Justice

The fairness perceived in the processes and methods used to make decisions and resolve disputes.

Interpersonal Treatment

The manner in which individuals interact with and regard one another within personal and professional relationships.

Benefits and Costs

The positive outcomes and the negative impacts, respectively, associated with a decision or action.

Interests and Values

Personal preferences and principles that guide an individual's decisions and behavior.