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1. Another name for the bird-in-hand theory of dividend is?
A. Dividend irrelevance theory
B. Tax Effect Theory
C. Dividend preference theory
D. Signaling hypothesis
2. According to the tax effect theory of dividend, stockholders
A. prefer less dividend payouts
B. prefer more dividend payouts
C. are indifferent to dividend payouts
D. prefer stock splits
3.Which of the following affects the ability of a firm to take full advantage of tax shield offered by debt?
A.High level of debt increases the threat of bankruptcy
B.Debt reduces the value real options
C.Debt increases the value of real options
D.High level of debt reduces the threat of bankruptcy
E.Debt offered the option to expand production if the product is successful.
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