ch18 - ch18 Student Multiple Choice Questions 1 Payments...

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Unformatted text preview: ch18 Student: _______________________________________________________________________________________ Multiple Choice Questions 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. 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. 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. 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. 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 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 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. 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. 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. 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. MM Proposition I. E. MM Proposition II. 11. The observed empirical fact that stocks attract particular investors based on the firm's dividend policy and the resulting tax impact on investors is called the: A. information content effect. B. clientele effect. C. efficient markets hypothesis. D. MM Proposition I. E. MM Proposition II. 12. A _____ is an alternative method to cash dividends which is used to pay out a firm's earnings to shareholders....
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ch18 - ch18 Student Multiple Choice Questions 1 Payments...

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