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Chris M.
Chris M., M.S.W. Social Work
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Which of the following statements is CORRECT a. Firms with

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Which of the following statements is CORRECT?

a. Firms with a large number of investment opportunities and a relatively small amount of cash tend to have above average dividend payout ratios.
b. One advantage of the residual dividend policy is that it leads to a stable dividend payout, which investors like.
c. An increase in the stock price when a company decreases its dividend is consistent with signaling theory.
d. If the “clientele effect” is correct, then for a company whose earnings fluctuate, a policy of paying a constant percentage of net income will probably maximize the stock price.
e. Stock repurchases make the most sense at times when a company believes that its stock is undervalued.
Submitted: 7 years ago.
Category: Homework
Expert:  Chris M. replied 7 years ago.

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