Which of the Following Statements Is Correct

question 30

Multiple Choice

Which of the following statements is correct?

• A)If a firm follows the residual dividend policy, then a sudden increase in the number of profitable projects is likely to reduce the firm's dividend payout.
• B)The clientele effect can explain why so many firms change their dividend policies so often.
• C)One advantage of adopting the residual dividend policy is that this policy makes it easier for corporations to develop a specific and well-identified dividend clientele.
• D)New-stock dividend reinvestment plans are similar to stock dividends because they both increase the number of shares outstanding but don't change the firm's total amount of book equity.

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Definitions:

Placental LH-like Hormone

A hormone produced by the placenta that is structurally similar to luteinizing hormone (LH) and supports the corpus luteum, maintaining the production of progesterone during early pregnancy.

Trimester

A term describing a period of three months, often used to divide the nine months of pregnancy into three stages, each with its own developmental milestones.

Melatonin Secretion

The release of melatonin, a hormone regulated by the pineal gland, which influences sleep-wake cycles and circadian rhythms.

Half-Lives

The time required for a quantity to reduce to half its initial amount, often used to describe the decay of radioactive substances or the elimination of drugs from the body.