Which of the Following Statements Is Most Correct

Multiple Choice

Which of the following statements is most correct?

A) The bird-in-the-hand theory implies that a company can reduce its WACC by reducing its dividend payout.
B) The bird-in-the-hand theory implies that a company can increase its stock price by reducing its dividend payout.
C) One problem with following a residual distribution policy (with all distributions in the form of dividends) is that it can lead to erratic dividend payouts that may prevent the firm from establishing a reliable clientele of investors who prefer a particular dividend policy.
D) Statements a and c are correct.
E) All of the statements above are correct.