A Firm Has Had the Following Earnings History Over the Last

Multiple Choice

A firm has had the following earnings history over the last five years: If the firm's dividend policy is based on a $0.50 payout per share whenever it makes a positive earnings, increasing by $0.05 to previous year dividends per share whenever earnings exceed $1.50 per share, the annual dividends for 2014 and 2015 were ________.

A) $0.50 and $0.60, respectively
B) $0.50 and $0.55, respectively
C) $0.55 and $0.65, respectively
D) $0.60 and $0.65, respectively