Which one of the following is cited as an argument favoring a high dividend payout?
A) Flotation costs involved with a new securities issue
B) High personal tax rates relative to corporate rates
C) Desire to maintain constant dividends over time
D) Restrictive covenant on dividend payouts contained in a bond indenture agreement
E) Agency costs related to excess cash reserves
Correct Answer:
Verified
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A)set high target payout ratios when
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A)are reluctant to cut dividends.
B)tend to
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