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Which of the Following Is True About the Payment of Dividends

Question 23

Multiple Choice

Which of the following is true about the payment of dividends by a firm?


A) Dividends are paid only to the bondholders of the firm
B) Common stockholders have priority over preferred stockholders with regard to dividends
C) Preferred stocks will pay accumulated dividends only once i.e. at the time of maturity
D) Growth stocks pay little or no dividends and instead retain most of their earnings each year
E) Common stockholders will receive a fixed amount of dividend every year

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