Which of the Following Would Be a Reason for a Company

question 146

Multiple Choice

Which of the following would be a reason for a company to restrict its cash dividends or treasury stock purchases?

• A) Because the company needs treasury stock to offer as performance incentives to upper management
• B) In order to give shareholders stock dividends
• C) Due to the desire of shareholders to retain the company's earnings for future growth and capital expenditures
• D) Due to requirements of lenders or creditors that companies maintain enough equity to meet their obligations

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Definitions:

Antidiuretic Hormone

A hormone released by the pituitary gland that regulates water retention in the body by increasing the concentration of solutes in the blood.

Collecting Ducts

Tubules in the kidneys that receive urine from the nephrons and transport it into the renal pelvis and ureter.

Reabsorbed

The process by which substances are taken back into the blood from the filtrate produced in the kidneys.

Concentration Gradient

A variation in the concentration of a substance across a distance; a key factor in diffusion processes.