Which Part of Shareholders' Equity May Not Be Used to Pay

question 29

Multiple Choice

Which part of shareholders' equity may not be used to pay cash dividends?

• A) Retained profits.
• B) Share capital.
• C) Revenue reserves.
• D) Both A and B.

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Definitions:

Discontinuous Innovation

A breakthrough product or service that creates a completely new market or drastically changes both the existing market and consumer habits.

Market Modification

The process of changing a market’s dynamics, including product offerings, pricing strategies, and customer engagement to achieve better performance or competitive advantage.

Product Repositioning

The strategic process of changing a product's place in the market by altering its image, target audience, or distinct features.

Trialability

A characteristic of a product or service that allows potential consumers to experiment with it on a limited basis before making a purchase decision.