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1. Which of the following should be included in the initial outlay? A. Purchase price of new equipment B. Increased working capital requirements C. Pre-existing
1. Which of the following should be included in the initial outlay? A. Purchase price of new equipment B. Increased working capital requirements C. Pre-existing firm overhead reallocated to the new project D. A and B above 2. Which of the following is NOT included in the calculation of the initial outlay for a capital budget? A. Additional working-capital investments B. Training expenses C. Installation D. All is included in the initial outlay 3. Dividend policy is influenced by: A. a firm's capital structure mix. B. a company's investment opportunities. C. a company's availability of internally generated funds. D. all of the above. 4. Which of the following dividend policies will cause dividends per share to fluctuate the most? A. Stable dollar dividend B. Constant dividend payout ratio C. Small, low, regular dividend plus a year-end extra D. No difference between the various dividend policies 5. Which of the following statements would be consistent with the bird-in-the-hand dividend theory? A. Dividends are less certain than capital gains B. Dividends are more certain than capital gains income C. Investors are indifferent whether stock returns come from dividend income or capital gains income D. Wealthy investors prefer corporations to defer dividend payments because capital gains produce greater after-tax income
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