One Rationale for Using Expected Dividends in Valuation Is

question 4

Multiple Choice

One rationale for using expected dividends in valuation is:

• A) Dividends are a necessary payment in order for a firm to have value.
• B) Dividends are paid in cash, and cash serves as a measurable common denominator for comparing the future benefits of alternative investment opportunities.
• C) Dividends are the most reliable measure of value because most companies payout dividends to shareholders.
• D) Dividend payout ratios are set based on profitability.

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Definitions:

Concrete-Operational Stage

A stage in Piaget's theory of cognitive development, occurring roughly between the ages of 7 and 12 years, during which children gain a better understanding of mental operations and physical concepts.

Conservation Of Liquid

a cognitive skill, identified by Piaget, that allows a child to understand that the quantity of a liquid remains the same despite changes in the shape of its container.

Conservation

The understanding that certain properties of objects, like volume or mass, remain the same despite changes in the objects' form or appearance.

Length

A measurement of how long something is from end to end, typically measured in units such as meters, feet, or inches.