please check the upload file for the questionsThe date of record is:
?The actual date the firm pays the dividend to the holders of record.
?This date is the first date on which a stock is sold without the right to receive the current dividend.
?The date the dividend is declared by the company’s Board of Directors.
?The date on which all persons who are on record as owning a share of stock will receive the dividend.
What are some of the advantages of a stock repurchase? (Choose all that apply)
?It signals to the market that the company believes its stock is overvalued.
?It raises cash for the company.
?It does not have the some ongoing expectation as dividends.
?It signals to the market that the company believes its stock is undervalued.
The declaration date is:
?The date the dividend is declared by the company’s Board of Directors.
?This date is the first date on which a stock is sold without the right to receive the current dividend.
?The actual date the firm pays the dividend to the holders of record.
?The date on which all persons who are on record as owning a share of stock will receive the dividend.
The payment date is:
?This date is the first date on which a stock is sold without the right to receive the current dividend.
?The date on which all persons who are on record as owning a share of stock will receive the dividend.
?The actual date the firm pays the dividend to the holders of record.
?The date the dividend is declared by the company’s Board of Directors.
Does the payment of dividend influence the stock price?
?Yes, higher dividends always are a positive signal to investors of future earning potential.
?Yes, higher dividends always lead to a higher stock price.
?There are conflicting theories regarding dividend relevance, and no one answer is clearly established.
?No, dividends are always irrelevant to the stock price.
What is a potential downside to a stable dividend policy?
?The dividend will rise and fall with earnings.
?Investors will be unsure of what the dividend will be in each year.
?Dividends may grow too large if earnings continue to grow.
?If earnings drop severely, the company might run short of the cash needed to pay the dividend.
Why would a company issue a stock split?
?It wants to issue shares.
?It wants to repurchase shares.
?It believes the share price is too high and would like to lower it.
?It believes the share price is too low and would like to raise it.
The ex-dividend date is:
?The date the dividend is declared by the company’s Board of Directors.
?This date is the first date on which a stock is sold without the right to receive the current dividend.
?The actual date the firm pays the dividend to the holders of record.
?The date on which all persons who are on record as owning a share of stock will receive the dividend.
What are some of the advantages of a stock repurchase? (Choose all that apply)
?It signals to the market that the company believes its stock to be undervalued.
?It is a source of cash for the company.
?There is not the same level of ongoing expectation as with a dividend.
?It signals to the market that the company believes its stock to be overvalued.
A firm may repurchase outstanding shares of stock to:
1. a. concentrate ownership of the firm
b. all of the above
c. deploy excess cash
d. offset potential dilution
A firm which will periodically pay special dividends follows the:
1. a. constant dividend payout ratio
b. stable dividend policy
c. low dividend plus extra policy
d. residual theory of dividends
A policy which ties the dividend payout to a percentage of earnings is known as:
1. a. stable dividend policy
b. constant dividend payout ratio
c. low dividend plus extra policy
d. residual theory of dividends
Assuming no holidays, a purchaser of stock on Monday is the holder of record on:
1. a. Monday
b. Tuesday
c. Thursday
d. Wednesday
The actual date the firm pays the dividend to the holders of record is known as:
1. a. ex-dividend date
b. date of record
c. payment date
d. declaration date
The date on which all persons who are on record as owning a share of stock will receive the dividend is known as:
a. date of record
b. declaration date
c. payment date
d. ex-dividend date
The date the dividend is declared by the company’s Board of Directors is known as:
1. a. date of record
b. declaration date
c. payment date
d. ex-dividend date
The most common practice is a variation of the:
1. a. residual theory of dividends
b. stable dividend policy
c. constant dividend payout ratio
d. low dividend plus extra policy
This date is the first date on which a stock is sold without the right to receive the current dividend is known as:
1. a. payment date
b. declaration date
c. date of record
d. ex-dividend date
Typically, if a firm decides to pay a dividend:
1. a. investors will sell their holdings
b. all of the above
c. investors expect the firm will continue to pay dividends in the future
d. investors negatively view the firm’s income stream
What is the correct chronological dividend payment timeline?
1. a. declaration date, date of record, ex-dividend date, payment date
b. payment date, declaration date, date of record, ex-dividend date
c. declaration date, ex-dividend date, date of record, payment date
d. ex-dividend date, payment date, date of record, declaration date
When a company manipulates its share price by increasing the number of shares belonging to each shareholder this is known as a:
1. a. share repurchase
b. IPO
c. cash dividend
d. stock split
When shares of stock instead of cash is distributed this is known as a:
1. a. stock split
b. share repurchase
c. stock dividend
d. cash dividend
Why would a firm choose to buy back shares instead of issue a dividend?
1. a. The firm does not want to commit to future financial obligations.
b. The firm believes the stock is overvalued.
c. The firm does not have excess cash.
d. All of the above.
What famous company mentioned in the chapter did not pay a dividend for many years explaining that the money was better spent on research and development?
A. Google
B. Procter and Gamble
C. Microsoft
D. Boeing
