Author Question: Which of the following supports the bird-in-the-hand dividend theory? A) Investment decisions are ... (Read 47 times)

Kikoku · **on:** Jul 10, 2018

Which of the following supports the bird-in-the-hand dividend theory?

A) Investment decisions are not influenced by dividend policy.
B) Capital mix decisions are not influenced by dividend policy.
C) Investors prefer dividends to capital gains because of the time value of money.
D) Increasing a firm's dividends transfers risk and ownership from the current shareholders to
new owners.

Question 2

The most important reasons firms hold cash balances are the transaction and precautionary
motives.

Indicate whether the statement is true or false