Which dividends are best described as

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Problem 1: Which one of the following statements is correct?

A. Preferred stock cannot be callable.
B. Preferred stock generally has a stated liquidation value of $100 per share.
C. Preferred dividends are generally variable in amount.

Problem 2: Dividends are best described as:

A. cash payments to shareholders.
B. cash payments to either bondholders or shareholders.
D. cash or stock payments to either bondholders or shareholders.

Problem 3: Which of the following statements are correct?

I. A shorter payback period is preferred over a longer payback period.
II. The payback rule states that you should accept a project if the payback period is less than one year.
III. The payback period ignores the time value of money.
IV. The payback rule is biased in favor of short-term projects.
V. The payback period considers the timing and amount of all of a project's cash flows.

A. I and IV only
B. III, IV, and V only
C. I, III, and IV only

Reference no: EM132736704

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