Ross. Westerfield. Jaffe. Jordan Chapter 18 Test

Ross. Westerfield. Jaffe. Jordan Chapter 18 Test - CHAPTER...

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18-1 CHAPTER 18 Dividend and Other Payouts Multiple Choice Questions: I. DEFINITIONS DIVIDENDS a 1. Payments made out of a firm’s earnings to its owners in the form of cash or stock are called: a. dividends. b. distributions. c. share repurchases. d. payments-in-kind. e. stock splits. Difficulty level: Easy DISTRIBUTIONS b 2. Payments made by a firm to its owners from sources other than current or accumulated earnings are called: a. dividends. b. distributions. c. share repurchases. d. payments-in-kind. e. stock splits. Difficulty level: Easy REGULAR CASH DIVIDENDS c 3. A cash payment made by a firm to its owners in the normal course of business is called a: a. share repurchase. b. liquidating dividend. c. regular cash dividend. d. special dividend. e. extra cash dividend. Difficulty level: Easy LIQUIDATING DIVIDENDS a 4. A cash payment made by a firm to its owners when some of the firm’s assets are sold off is called a: a. liquidating dividend. b. regular cash dividend. c. special dividend. d. extra cash dividend. e. share repurchase. Difficulty level: Easy
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18-2 DECLARATION DATE e 5. The date on which the board of directors passes a resolution authorizing payment of a dividend to the shareholders is the _____ date. a. ex-rights b. ex-dividend c. record d. payment e. declaration Difficulty level: Easy EX-DIVIDEND DATE b 6. The date before which a new purchaser of stock is entitled to receive a declared dividend, but on or after which she does not receive the dividend, is called the _____ date. a. ex-rights b. ex-dividend c. record d. payment e. declaration Difficulty level: Easy DATE OF RECORD c 7. The date by which a stockholder must be registered on the firm’s roll as having share ownership in order to receive a declared dividend is called the: a. ex-rights date. b. ex-dividend date. c. date of record. d. date of payment. e. declaration date. Difficulty level: Easy DATE OF PAYMENT d 8. The date on which the firm mails out its declared dividends is called the: a. ex-rights date. b. ex-dividend date. c. date of record. d. date of payment. e. declaration date. Difficulty level: Easy
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18-3 HOMEMADE DIVIDENDS e 9. The ability of shareholders to undo the dividend policy of the firm and create an alternative dividend payment policy via reinvesting dividends or selling shares of stock is called (a): a. perfect foresight model. b. MM Proposition I. c. capital structure irrelevancy. d. homemade leverage. e. homemade dividend policy. Difficulty level: Medium INFORMATION CONTENT EFFECT a 10. The market’s reaction to the announcement of a change in the firm’s dividend payout is likely the: a. information content effect. b. clientele effect. c. efficient markets hypothesis. d.
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Ross. Westerfield. Jaffe. Jordan Chapter 18 Test - CHAPTER...

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