12.

13.

14.

15.

16.

17.

18.

Companies with falling or constant profits can:
(A) Avoid paying dividend during inflation
(B) Paying more dividend during inflation
(C) Hither (A) or (8)
(D) None of these

Maximization of the owner’s wealth/ Shareholder’s wealth is represented by which of the
following:

(A) Market price of a share (B) Book value of firm’s assets
(C) Salary paid to employees (D) Allof these

dividend amounts to capitalization of earnings and distribution of profits
among the existing shareholders without affecting the cash position of the firm.

(^) Scrip dividend (B) Bond dividend
(C) Stock dividend (D) Property dividend

Which among the following is not a determinant of dividend policy?

(ಹ) Legal restrictions (B) Nature of Industry

(C) Capital market conditions (D) Taxation policy
According to ‏ل‎ whatever increase in the value of the firm results from the payment is
dividend will be exactly offset by the decline in the market price of share.

(A) James. ए. Walter (B) Modigliani and Miller

(C) Myron Gordon (D) None of these

Which one of the following is not an assumption of Walter’s Model of dividend?
(A) the internal rate of return and cost of capital of the firm are constant
(B) the investments of the firm are financed using external sources of funds
(C) earnings and dividends do not change while determining value

(D) the firm has a very long life

The cash kept aside by the investor equips him to exploit an attractive investment
opportunity. This motive is termed as:

(^) Precautionary motive (2) Speculative motive

(C) Transaction motive (D) None of these

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