1- The primary reason for creating dual or multiple classes of stock has to do with:

A) Control of the firm.

B) Paying for acquisitions.

C) Satisfying TSX (Toronto Stock Exchange) bylaws.

D) Stock Exchange listing requirements.

E) None of the above.

2- Which of the following is (are) true?

I. The dividend growth model only holds if, at some point in time, the dividend growth rate exceeds the stock's required return.

II. An increase in the dividend growth rate will increase a stock's market value, all else the same.

III. An increase in the required return on a stock will decrease its market value, all else the same.

A) I only

B) III only

C) II and III only

D) I and III only

E) I, II, and III

3- Over the past four years, a company has paid dividends of $1.00, $1.10, $1.20, and $1.30, respectively. This pattern is expected to continue into the future. This is an example of a company paying a:

A) Dividend that grows by 10% each year.

B) Dividend that grows at a constant rate.

C) Dividend that grows by a decreasing amount.

D) Dividend that grows at a decreasing rate.

E) Preferred stock dividend.