The Residual Theory of Dividend Policy Asserts That

question 55

Multiple Choice

The residual theory of dividend policy asserts that

• A)sufficient dividends are paid to maintain a stable total dividend payment-any residual is invested internally by the firm.
• B)sufficient dividends are paid to maintain a stable dividend payout ratio-any residual is invested internally by the firm.
• C)dividends are paid out of the residual remaining after internal investments by the firm.
• D)dividend payments are adjusted to maintain dividends at a constant percentage of total cash flows.

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Definitions:

Future Business

Prospective or upcoming commercial activities, opportunities, or endeavors a company plans to undertake.

Adjustment Message

is a communication sent by a company in response to a customer complaint, designed to address the issue and rectify the situation, often aiming to maintain or restore customer satisfaction.

High-Performance Router

A networking device designed to handle large amounts of data traffic with high speed and efficiency.

Installation

The process of setting up equipment, a system, or software so that it is ready for use.