MM theory in perfect market suggests that dividend payment
A. has a positive impact on the value of a firm
B. has no impact on the value of a firm
C. has a negative impact on the value of a firm
D. has negligible impact on the firm
Answer: Option B
A. has a positive impact on the value of a firm
B. has no impact on the value of a firm
C. has a negative impact on the value of a firm
D. has negligible impact on the firm
Answer: Option B
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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