According to the Residual Theory of Dividends, If the Firm's

question 41

Multiple Choice

According to the residual theory of dividends, if the firm's equity need is less than the amount of retained earnings, the firm would

• A) borrow to pay the cash dividend.
• B) declare a dividend equal to the remaining balance.
• C) pay no cash dividends.
• D) not need to consider its dividend policy.

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Definitions:

Environmental Cost Leadership

A business strategy focused on becoming the market leader by implementing cost-saving environmental practices, thus offering competitively priced goods or services while minimizing ecological impacts.

Corporate Social Responsibility

A business model that helps a company be socially accountable to itself, its stakeholders, and the public.

Sustainable Consumer Behavior

Consumer habits and practices that are conscious of environmental sustainability, aiming to minimize negative impact on the environment through thoughtful consumption.

Distrust

A feeling of doubt about the honesty, integrity, or reliability of a person or system, often leading to caution or avoidance.