FMGT212-Financial Management 2

1. FMGT212
2. Week 11: Dividends, Share Repurchase, and other Payouts
3. Short Quiz 009

What happened when the company repurchases shares from existing shareholders?

Select one:

a. EPS increases

b. All of the above choices

c. Number of shares outstanding decreases

d. Market price of shares increases

An increase in which of the following is likely to increase a firm's ability to pay dividends?

Select one:

a. Both a and b.

b. Liquidity

c. Access to capital markets

d. New capital requirements for expansion

What type of dividend policy pays out whatever remains after the profitable investment
opportunities are considered?

Select one:

a. Stable dividend policy

b. Constant dividend payout ratio

c. Residual dividend policy

d. Regular dividends plus extra policy

Check

Which is the most common dividend policy?

Select one:

a. Constant dividend payout ratio

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 b. Stable dividend policy

c. Residual dividend policy

d. Regular dividends plus extra policy

It is also called the Bird-in-the hand theory.

Select one:

a. Walter model

b. M&M theory

c. Gordon/Lintner model

d. None of the above choices.

Stock split resulted to the following except

Select one:

a. Increase the total market value of the equity

b. Reduced par value per share

c. Increase in number of outstanding shares

d. Decrease in market price of shares

Check

Dividends should not be made out of the capital of the firm is what legal requirements rule?

Select one:

a. Insolvency rule

b. Capital impairment rule

c. Solvency rule

d. Net income rule

Following are the proponents of the Dividend Relevance theories except

Select one:

a. Miller

b. Lintner

c. Gordon

d. Walter

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 Check

Dividend policy are finally approved by the

Select one:

a. Chief Financial Officer

b. Board of Directors

c. President of the company

d. The Treasurer
Check

The date the company distributes its dividend checks to the shareholders on record.

Select one:

a. Ex-dividend Date

b. Payment Date

c. Declaration Date

d. Record Date

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