Which of the Following Statements Is FALSE

question 38

Multiple Choice

Which of the following statements is FALSE?

• A)In perfect capital markets, holding fixed the investment policy of a firm, the firm's choice of dividend policy is irrelevant and does not affect the initial share price.
• B)In perfect capital markets, investors are indifferent between the firm distributing funds via dividends or share repurchases. By reinvesting dividends or selling shares, they can replicate either payout method on their own.
• C)In perfect capital markets, an open market share repurchase has no effect on the share price, and the share price is the same as the ex-dividend price if a dividend were paid instead.
• D)In a perfect capital market, when a dividend is paid, the share price drops by the amount of the dividend when the share begins to trade ex-dividend.

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Definitions:

Integrity

The quality of being honest and having strong moral principles, often regarded as a fundamental trait for trustworthiness and ethical conduct.

Motivation

The internal and external factors that stimulate people to take actions that lead to achieving a goal.

Transactional Leaders

focus on the exchanges that occur between leaders and their followers, often emphasizing clear structures, rewards, and penalties.

Change Agents

Individuals or entities that act as catalysts for change within an organization, facilitating and implementing different strategies to ensure successful transformations.