Question 1

A cash dividend reduces a firm's equity.​

Accepted Answer

A) True 
 B)False  True

Question 2

​Stock repurchases

Accepted Answer

A)  increase per share earnings 
B)  ​decrease per share earnings 
C)  ​increase liabilities 
D)  ​decrease liabilities 
A)  increase per share earnings 
B)  ​decrease per share earnings 
C)  ​increase liabilities 
D)  ​decrease liabilities A

Question 3

Dividend reinvestment plans are​

Accepted Answer

A)  ​a convenient means to accumulate shares 
B)  ​a means to defer federal income taxes on the dividends 
C)  available only if the corporation distributes stock dividends 
D)  ​more expensive than buying the stock through brokers 
A)  ​a convenient means to accumulate shares 
B)  ​a means to defer federal income taxes on the dividends 
C)  available only if the corporation distributes stock dividends 
D)  ​more expensive than buying the stock through brokers A

Question 4

Stock dividends increase the wealth of stockholders who receive additional shares. l> ​

Accepted Answer

A) True 
 B)False

Question 5

​Construct a new balance sheet showing the impact of a 5 percent stock dividend. What will be the new price of the
stock?

Accepted Answer

The new balance sheet after the 5 percen

Question 6

​Dividends are paid on the

Accepted Answer

A)  ​declaration date 
B)  ​ex dividend date 
C)  ​date of record 
D)  ​distribution date 
A)  ​declaration date 
B)  ​ex dividend date 
C)  ​date of record 
D)  ​distribution date

Question 7

Dividend reinvestment plans are a convenient means to encourage individuals to save.​

Accepted Answer

A) True 
 B)False

Question 8

If a stock is selling for $90 and is split 3 for 1, the new price of the stock should be $30.​

Accepted Answer

A) True 
 B)False

Question 9

If a firm does not pay cash dividends, it may reinvest the earnings and grow.​

Accepted Answer

A) True 
 B)False

Question 10

A stock dividend has no impact on a firm's liabilities or the price of its stock.​

Accepted Answer

A) True 
 B)False

Question 11

Which of the following is equity?
1) investments
2) additional paid‑in capital
3) retained earnings

Accepted Answer

A) ​1 and 2 
B) ​1 and 3 
C) ​2 and 3 
D) ​1, 2, and 3 
A) ​1 and 2 
B) ​1 and 3 
C) ​2 and 3 
D) ​1, 2, and 3

Question 12

Dividends come at the expense of

Accepted Answer

A)  ​interest 
B)  ​retained earnings 
C)  ​liabilities 
D)  ​stock 
A)  ​interest 
B)  ​retained earnings 
C)  ​liabilities 
D)  ​stock

Question 13

A company may pay
1) a regular quarterly cash dividend
2) stock dividends
3) no dividends​

Accepted Answer

A) ​1 and 2 
B) ​1 and 3 
C) ​2 and 3 
D) ​1, 2, and 3 
A) ​1 and 2 
B) ​1 and 3 
C) ​2 and 3 
D) ​1, 2, and 3

Question 14

Stock repurchases reduce​
1) total equity
2) total assets
3) corporate taxes
4) total liabilities

Accepted Answer

A) ​1 and 2 
B) ​1 and 3 
C) ​2 and 3 
D) ​3 and 4 
A) ​1 and 2 
B) ​1 and 3 
C) ​2 and 3 
D) ​3 and 4

Question 15

Corporations are obligated to pay cash dividends if they generate earnings.​

Accepted Answer

A) True 
 B)False

Question 16

Federal income taxes favor the retention of earnings over the distribution of earnings.​

Accepted Answer

A) True 
 B)False

Question 17

A 5% stock dividend reduces a firm's total equity.​

Accepted Answer

A) True 
 B)False

Question 18

​A stock split

Accepted Answer

A)  ​increases equity 
B)  ​generates capital gains 
C)  ​increases retained earnings 
D)  ​does not affect liabilities 
A)  ​increases equity 
B)  ​generates capital gains 
C)  ​increases retained earnings 
D)  ​does not affect liabilities

Question 19

Dividend reinvestment plans permit the stockholder to reinvest dividends as they are received.​

Accepted Answer

A) True 
 B)False

Question 20

A stock dividend

Accepted Answer

A)  ​reduces the firm's cash 
B)  ​increases the firm's total equity 
C)  ​decreases the firm's stock price 
D)  ​increases the firm's assets 
A)  ​reduces the firm's cash 
B)  ​increases the firm's total equity 
C)  ​decreases the firm's stock price 
D)  ​increases the firm's assets

Exam 10: The Features of Stock

A cash dividend reduces a firm's equity.​

​Stock repurchases

Dividend reinvestment plans are​

Stock dividends increase the wealth of stockholders who receive additional shares. l> ​

​Construct a new balance sheet showing the impact of a 5 percent stock dividend. What will be the new price of the stock?

​Dividends are paid on the

Dividend reinvestment plans are a convenient means to encourage individuals to save.​

If a stock is selling for $90 and is split 3 for 1, the new price of the stock should be $30.​

If a firm does not pay cash dividends, it may reinvest the earnings and grow.​

A stock dividend has no impact on a firm's liabilities or the price of its stock.​

Which of the following is equity? 1) investments 2) additional paid‑in capital 3) retained earnings

Dividends come at the expense of

A company may pay 1) a regular quarterly cash dividend 2) stock dividends 3) no dividends​

Stock repurchases reduce​ 1) total equity 2) total assets 3) corporate taxes 4) total liabilities

Corporations are obligated to pay cash dividends if they generate earnings.​

Federal income taxes favor the retention of earnings over the distribution of earnings.​

A 5% stock dividend reduces a firm's total equity.​

​A stock split

Dividend reinvestment plans permit the stockholder to reinvest dividends as they are received.​

A stock dividend

The Role of Financial Markets and Financial Intermediaries

Investment Banking

Securities Markets

The Federal Reserve

International Currency Flows

The Time Value of Money

Risk and Its Measurement

Analysis of Financial Statements

Stock Valuation

The Features of Long-Term Debt - Bonds

Bond Pricing and Yields

Preferred Stock

Convertile Securities

Investment Returns

Investment Companies

Forms of Businss and Corporate Taxation

Break-Even Analysis and the Payback Period

Leverage

Cost of Capital

Capital Budgeting

Forecasting

Cash Budgeting

Management of Current Assets

Management of Short-Term Liabilities

Intermediate-Term Debt and Leasing

Options: Puts and Calls

Futures and Swaps

Filters

A cash dividend reduces a firm's equity.

Stock repurchases

Dividend reinvestment plans are

Stock dividends increase the wealth of stockholders who receive additional shares. l>

Construct a new balance sheet showing the impact of a 5 percent stock dividend. What will be the new price of the stock?

Dividends are paid on the

Dividend reinvestment plans are a convenient means to encourage individuals to save.

If a stock is selling for $90 and is split 3 for 1, the new price of the stock should be $30.

If a firm does not pay cash dividends, it may reinvest the earnings and grow.

A stock dividend has no impact on a firm's liabilities or the price of its stock.

A company may pay 1) a regular quarterly cash dividend 2) stock dividends 3) no dividends

Stock repurchases reduce 1) total equity 2) total assets 3) corporate taxes 4) total liabilities

Corporations are obligated to pay cash dividends if they generate earnings.

Federal income taxes favor the retention of earnings over the distribution of earnings.

A 5% stock dividend reduces a firm's total equity.

A stock split

Dividend reinvestment plans permit the stockholder to reinvest dividends as they are received.