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A firm is profitable but cash poor. Which of the following statements about their dividend policy is true? The firm should pay dividends to encourage

A firm is profitable but cash poor. Which of the following statements about their dividend policy is true?

The firm should pay dividends to encourage investors to buy more stock

The firm needs to retain more earnings to improve their cash flow

The firm needs to improve its liquidity before paying dividends

The firm should pay itself before it pays its creditors

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