Financing a Business 09

9. Which of the following statements is correct?

A. The value of a company’s share will decrease unless a dividend is paid every year

B. The value of a company’s share will increase if a regular dividend is paid

C. If a company can earn a better rate of return, by investing retained profits, than shareholders can earn themselves, then dividends should be paid

D. If a company can earn a better rate of return, by investing retained profits, than shareholders can earn themselves, then there is a case for dividends not to be paid

 

 Answer : D