CFA Practice Question

There are 151 practice questions for this study session.

CFA Practice Question

Which of the following is incorrect?
A. At an average, academic studies show that dividend increases convey information about better future prospects for firms.
B. The Tax Preference Theory for dividends is based on the idea that investors prefer capital gains to dividends due to lower tax rates.
C. The Bird in Hand Theory of Gordon and Litner says that investors prefer the firm keep the profits rather than pay out cash dividends.
Explanation: The Bird in Hand Theory of Gordon and Litner says that investors prefer the firm pay out cash dividends rather than keep the profits.

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