KEY TERMS Define each of the following terms:

a. Target payout ratio; optimal dividend policy

b. Dividend irrelevance theory; bird-in-the-hand fallacy

c. Information content (signaling) hypothesis; clienteles; clientele effect

d. Catering theory; residual dividend model

e. Low-regular-dividend-plus-extras

f. Declaration date; holder-of-record date; ex-dividend date; payment date g. Dividend reinvestment plan (DRIP)

h. Stock split; stock dividend i. Stock repurchase.

AppendixLO1