Typically,a profitable company that pays little or no dividends:
A)is a bad investment.
B)will reinvest profits which can lead to greater growth potential.
C)will experience relatively stable stock prices over time.
D)will appeal to investors who desire distributions of profit.

Question

Quizplus · Accepted Answer

Some investors prefer to buy stocks that pay little or no dividends (called a growth investment)because companies that reinvest the majority of their earnings tend to increase their future earnings potential,along with their stock price.

Typically,a Profitable Company That Pays Little or No Dividends