Which of the Following Statements About Dividends Is $\bold{not}$ True?
A)Dividends Represent a Sharing of Corporate Profits with Owners

question 80

Multiple Choice

Which of the following statements about dividends is $\bold{not}$ true?

• A)Dividends represent a sharing of corporate profits with owners.
• B)Both stock dividends and cash dividends reduce retained earnings.
• C)Cash dividends paid to shareholders reduce net income.
• D)Dividends are declared at the discretion of the board of directors.

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Definitions:

Government Bonds

Debt securities issued by a government to finance its expenditures, often backed by the government's ability to tax its citizens.

Money Supply

The total amount of monetary assets available in an economy at a specific time, including cash, coins, and balances in bank accounts.

Market Rate

The prevailing interest rate available in the marketplace on a given financial product or the current price of a commodity or service.

Open Market Operations

Central bank activities involving the buying and selling of government securities in the open market to control the money supply and influence interest rates.