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The Ability of Shareholders to Undo the Dividend Policy of a Firm

Question 3

Multiple Choice

The ability of shareholders to undo the dividend policy of a firm and create an alternative dividend payment policy via reinvesting dividends or selling shares of stock is referred to as:


A) the perfect foresight model.
B) MM Proposition I.
C) capital structure irrelevancy.
D) homemade leverage.
E) homemade dividends.

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