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Q Corp has decided to pay out an extra $1 million to shareholder, while keeping investment policy and capital structure constant. Which statement is false?
Q Corp has decided to pay out an extra $1 million to shareholder, while keeping investment policy and capital structure constant. Which statement is false?
A. Q Corp must issue $1 million of stock to replace the lost cash.
B. the new shareholders will demand to receive shares worth $1 million.
C. the old shareholders will have reduced their stake in the firm by $1 million.
D. the reduced stake that old shareholders have in the firm will more than offset the benefit of the higher dividend.
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