2201AFE_Tutorial_10

2201AFE_Tutorial_10 - 2201AFE Corporate Finance TOPIC:...

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2201AFE Corporate Finance TOPIC: Dividends and Dividend Policy Multiple-Choice Questions 1. Payments made out of a firm’s earnings to its owners in the form of cash or stock is called: a. dividends. b. distributions. c. share repurchases. d. payments-in-kind. e. stock splits. 2. 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. 3. A cash payment made by a firm to its owners as a result of a one-time event is called a: a. share repurchase. b. liquidating dividend. c. regular cash dividend. d. special dividend. e. extra cash dividend. 4. 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 5. 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 6. 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.
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7. 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. 8. 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.
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2201AFE_Tutorial_10 - 2201AFE Corporate Finance TOPIC:...

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