1.T or F: The dividend payout ratio includes both stock dividends and cash dividends. 2.T or F: Firms with extra money should always repurchase their own stock, thus increasing the value of the firm. 3.Stability of dividends is not important to stockholders, especially to those that rely on fixed income. 4.T or F: The major drawback to an investor is that dividends are viewed as a passive variable, so a fixed income is never guaranteed. 5.T or F: A reverse stock split is normally used by those firms whose stock price has been stable for several years. Solution 1. False only cash dividens 2 False can invest too 3 False 4 True 5 False reverse split is used to increase the price.

1. 1.T or F: The dividend payout ratio includes both stock dividends and cash dividends.
2.T or F: Firms with extra money should always repurchase their own stock, thus increasing the
value of the firm.
3.Stability of dividends is not important to stockholders, especially to those that rely on fixed
income.
4.T or F: The major drawback to an investor is that dividends are viewed as a passive variable,
so a fixed income is never guaranteed.
5.T or F: A reverse stock split is normally used by those firms whose stock price has been stable
for several years.
Solution
1. False only cash dividens
2 False can invest too
3 False
4 True
5 False reverse split is used to increase the price