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A high dividend payout ratio lowers the possibility of management waste and are also less risky than potential future capital gains. This is the basic idea of _______________________

Question 17 options:

	the signaling effect theory
	the tax effect theory
	the dividend preference theory
	the dividend irrelevance theory

Question 18 (2 points)

Over the past 15-20 years, it can be said that:

Question 18 options:

	dividend payouts have increased and stock repurchases have decreased
	dividend payouts decreased and stock repurchases have increased
	dividend payouts have decreased and stock repurchases have decreased
	dividend payouts have increased and stock repurchases have increased

Question 19 (2 points)

Data supports the idea that when a country imposes high taxes on dividends, firms tend to _________________________

Question 19 options:

	lower the dividend payout
	increase the dividend payout
	seek offshore invesments
	file for bankruptcy

Question 20 (2 points)

All of the following are reasons a company might purchase shares of their own stock EXCEPT:

Question 20 options:

	to use when employees exercise stock options
	to make a large shift in capital structure (WACC)
	to dilute ownership among shareholders
	to dispose of excess cash from the sale of an asset

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