Which of the following statements about the residual dividend theory is FALSE?
A) The firm will maintain its optimum debt ratio in financing future investments.
B) Dividend policy by itself has no direct influence on the market price of the firm's ordinary shares.
C) The firm will issue new ordinary shares to finance investment opportunities in order to ensure that some dividend will be paid.
D) The firm's investment opportunities,capital structure,and profitability all influence the firm's dividend policy.
Correct Answer:
Verified
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