If ABC Corp.is Profitable

question 76

Multiple Choice

If ABC Corp.is profitable,

• A)it must pay dividends to its stockholders
• B)pretax profits are either paid as dividends or reinvested in the corporation
• C)after-tax profits are either paid as dividends or reinvested in the corporation
• D)it is contractually obligated to retain a portion of its earnings
• E)it typically uses the profits to buy back its own stock from the underwriter