In the real world , some investors desire low payout while others desire high payout . Which one of the following statement is correct ? O Endowment fund investors who cannot spend principal tend to favor a high - dividend payout . B. Firms with high flotation costs for equity issues tend to favor a high - dividend payout . tax rates on capital gains than on cash dividend income tend to favor a high - dividend payout . OD Pension funds that are tax - exempt tend to prefer a low - dividend payout to share repurchase .