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Author Question: AFB, Inc.'s dividend policy is to maintain a constant payout ratio. This year AFB, Inc. paid out a ... (Read 97 times)

kshipps

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  • Posts: 571
on: Jul 10, 2018
AFB, Inc.'s dividend policy is to maintain a constant payout ratio. This year AFB, Inc. paid out a
  total of 2 million in dividends. Next year, AFB, Inc.'s sales and earnings per share are expected to
  increase. Dividend payments are expected to
 
  A) remain at 2 million.
  B) decrease below 2 million.
  C) increase above 2 million.
  D) increase above 2 million only if the company issues additional shares of common stock.

Question 2

Which of the following statements is true?
 
  A) A low risk portfolio is constructed by selecting low risk stocks.
  B) It is easy to find perfectly negatively correlated stocks.
  C) Low risk portfolios will only reflect unsystematic risk.
  D) Negatively correlated stocks help build a low risk portfolio.
  E) Market risk reduces as more stocks are added to a portfolio.
Foundations of Finance ¦ Keown, Petty, Martin ¦ 9th Edition
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Ptupou85

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  • Posts: 334
Reply #1 on: Jul 10, 2018
Answer to Question 1

C

Answer to Question 2

D


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