The Practice of Maintaining Relatively Constant Dividends Is Called

question 77

Multiple Choice

The practice of maintaining relatively constant dividends is called:

• A)dividend calibration.
• B)dividend rollover.
• C)dividend smoothing.
• D)dividend rollbacks.
• E)dividend consistency.

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Definitions:

Tax Rate

The percentage at which an individual or corporation is taxed, which can vary according to income or profit levels.

Cost of Debt

The cost of debt is the effective rate that a company pays on its total debt, used in capital structuring decisions to evaluate the affordability of borrowing.

Dividend Growth Model

A model that estimates the value of a stock based on its expected dividends and their growth rate.

Retained Earnings

The portion of net earnings not paid out as dividends but reinvested in the business or kept as reserve.