Match the statements in List-I with dividend models in List-II as follows:
| List-I | List-II |
| a. Dividend Capitalization Approach | 1. Traditional Model |
| b. Dividend policy has a bearing on the share valuation | 2. Gordon Model |
| c. Stock market places more weight on dividends than on retain earnings | 3. Walter Model |
| d. Dividend payout is irrelevant to the value of the firm | 4. Modigliani and Miller Model |
A. a-2, b-3, c-1, d-4
B. a-1, b-2, c-4, d-3
C. a-4, b-1, c-3, d-2
D. a-3, b-4, c-2, d-1
Answer: Option A
This Question Belongs to Commerce >> Business Finance
The appropriate ratio for indicating liquidity crisis is
A. Operating ratio
B. Sales turnover ratio
C. Current ratio
D. Acid test ratio
A. Net present value method
B. Internal rate of return method
C. Profitablity index method
D. None of the above
A. a-4, b-3, c-1, d-2
B. a-3, b-4, c-1, d-2
C. a-2, b-3, c-1, d-4
D. a-3, b-2, c-4, d-1
Which one of the following assumptions is not included in the James E. Walter Valuation model?
A. All financing by retained earnings only
B. No change in the key variables such as EPS and DPS
C. The firm has finite life
D. All earnings are either distributed as dividends or invested internally immediately
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