Which of the Following Best Describes the Dividend Decision in Terms

Multiple Choice

Which of the following best describes the dividend decision in terms of benefits for the stockholder?

A) Paying dividends creates a short-term benefit, while retaining earnings has the potential to be a long-term benefit.
B) Paying dividends creates a long-term benefit, while retaining earnings has the potential to be a short-term benefit.
C) Paying dividends and retaining earnings both create short-term benefits.
D) Paying dividends and retaining earnings both create long-term benefits.
E) The decision to pay dividends or retain earnings has little impact on the stockholder.