Question
Which of the following statements best describes the clientele effect explanation of dividend payout policies? Question 5 options: a)Seniors who rely on their investments for
Which of the following statements best describes the clientele effect explanation of dividend payout policies?
Question 5 options:
a)Seniors who rely on their investments for spending and whose post retirement income is low may prefer low-dividend payouts.
b)The existence of tax clienteles implies that each firm will attract a specific group of investors, depending on their dividend policy.
c)The clientele explanation of dividends provides a reason why firms may want to alter their established dividend policies in order to attract a different investor group.
d)Investors are in different tax clienteles, depending on their income levels, with high-income individuals paying higher taxes on capital gains income, so that they prefere growth stocks with low-dividend payouts.
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