In 2004, Microsoft paid one of the largest extraordinary dividends in history. All of the following contributed to this historical event except ___________________.

Question

Quizplus · Accepted Answer

All of the other options contributed to Microsoft's decision to pay an extraordinary dividend. The JGTRRA of 2003 reduced the tax burden for investors, which made offering a large dividend more attractive. Microsoft had a significant amount of cash on its balance sheet and was not investing in many capital budgeting projects, making a dividend payout more feasible. However, there is no indication that Microsoft was specifically interested in changing its capital structure, making option B the correct choice.

In 2004, Microsoft Paid One of the Largest Extraordinary Dividends