The rational expectations model of dividend policy says that ______________.
A. Since the expectations of the investors are always rational, there will be no effect of dividend policy on the valuation of the firm
B. If the investors have rational expectations, they will value a dividend paying firm higher than a non-dividend paying firm
C. If the declared dividend is in line with expectations of the investors, there will be no effect on the valuation of the firm
D. If the declared dividend is in accordance with the expectations, the change in the firms value will be minimal
Answer: Option D
Solution(By Examveda Team)
The rational expectations model of dividend policy says that If the declared dividend is in accordance with the expectations, the change in the firms value will be minimal.This Question Belongs to Commerce >> Financial Management
Investment is the _______________.
A. net additions made to the nation’s capital stocks
B. person’s commitment to buy a flat or house
C. employment of funds on assets to earn returns
D. employment of funds on goods and services that are used in production process
Financial Management is mainly concerned with ______________.
A. All aspects of acquiring and utilizing financial resources for firms activities
B. Arrangement of funds
C. Efficient Management of every business
D. Profit maximization
The primary goal of the financial management is ____________.
A. to maximize the return
B. to minimize the risk
C. to maximize the wealth of owners
D. to maximize profit
In his traditional role the finance manager is responsible for ___________.
A. proper utilisation of funds
B. arrangement of financial resources
C. acquiring capital assets of the organization
D. efficient management of capital
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