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NEW QUESTION: 1
Which equation correctly illustrates the cost variance of a project, in dollars?
A. BCWP-ACWP
B. BCWP/ACWP
C. BCWP-BCWS
D. BCWP/BCWS
Answer: A
NEW QUESTION: 2
Myron Gordon and John Lintner believe that the required return on equity increases as the dividend payout ratio is decreased. Their argument is based on the assumption that
A. investors value a dollar of expected capital gains more highly than a dollar of expected dividends because of the lower tax rate on capital gains.
B. capital gains are taxed at a higher rate than dividends.
C. investors are indifferent between dividends and capital gains.
D. investors view dividends as being less risky than potential future capital gains.
E. investors require that the dividend yield and capital gains yield equal a constant.
Answer: D
Explanation:
Explanation/Reference:
Explanation:
The main conclusion of MM's irrelevance theory is that dividend policy does not affect the required rate of return on equity. Gordon-Lintner disagreed stating that k(s) decreases as the dividend payout is increased because investors are less certain of receiving the capital gains which should result from retaining earnings than they are of receiving dividends. They said that investors value expected dividends more highly than expected capital gains because the dividend yield is less risky than the growth component in the total expected return equation, k(s) = D1/Po + g.
NEW QUESTION: 3
A. Option B
B. Option D
C. Option C
D. Option A
Answer: D
Explanation:
Explanation: https://technet.microsoft.com/en-us/library/cc722414(v=ws.11).aspx
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