CFA Practice Question

There are 151 practice questions for this study session.

CFA Practice Question

The ______ says that the firm should follow its investment policy of accepting all positive NPV projects and paying out dividends when, and only when, funds are readily available.
A. dividend signaling hypothesis
B. residual theory of dividends
C. positive adjustment theory
Explanation: The residual theory of dividends says that the firm should follow its investment policy of accepting all positive NPV projects and paying out dividends when, and only when, funds are readily available.

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