The so-called clientele effect results in firms having a stable and predictable dividend policy. a. True b. False The so-called Bird-in-Hand Theory recommends that firms should pay a low and irregular dividend. a. True b. False Which of the following statements about a DRIP is correct? a. They are seldom used by firms because they are not really useful. b. They lead to higher flotation costs for the firm. c. They are attractive for the so-called Bird-in-Hand Clientele. d. They are an implementation of the so-called Dividend Irrelevance Theory. e. They are mostly used by firms in the Growth Phase. In the real world, dividends a. are usually more stable than earnings. b. fluctuate more widely than earnings. c. tend to be a lower percentage of earnings for mature firms. d. are usually changed every year to reflect earnings changes, and these changes are randomly higher to lower, depending on whether earnings increased or decreased. e. are usually set as a fixed percentage of earnings, e.g., at 40% of earnings, so if EPS = $2.00, then DPS would equal $0.80. Once the percentage is set, then dividend policy is on "automatic pilot" and the dividend actually paid depends strictly on earnings