Dividend Payments That Are the Result of Liquidation of Assets

question 104

Multiple Choice

Dividend payments that are the result of liquidation of assets are known as ________ and are taxed as capital gains.

• A) return of capital
• B) rolling dividends
• C) alternate payments
• D) private earnings

Identify real-world applications and benefits of adopting cloud computing services.

Understand the difference between proprietary, open-source, and pirated software.

Identify the impact of software errors and the prevalence of errors in professional programming.

Recognize the economic impact of software piracy on vendors.

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Definitions:

WACC

The Weighted Average Cost of Capital is a metric that calculates a company's cost of capital, with each capital category being weighted proportionally.

Capital Budgeting

The process by which investors or managers decide which capital investment projects - like new machinery or expansion plans - to undertake, based on potential profitability and risk analysis.

Opportunity Cost

A cash flow that a firm must forego to accept a project. For example, if the project requires the use of a building that could otherwise be sold, the market value of the building is an opportunity cost of the project.

Overall WACC

A comprehensive measure of a company's cost of capital, incorporating the weighted costs of its equity and debt financing.