1. Which of the following statements concerning dividend policy is true?
1. A constant payout ratio policy enables stockholders to accurately predict future dividends.
2. Since there is no evidence that one investor group is better than another, firms should change dividend policies frequently with no adverse impact stock price.
3. Firms with stable earnings, such as utilities, tend to have a low dividend payout ratio.
4. Unexpected dividend increase announcements are usually perceived as positive signals because they indicate an expected increase in future earnings of the firm.
2. Which of the following leads to the payment of a higher insurance premium by the potential insured?
Wedding of the potential insured
Obesity of the potential insured
Childbirth in the family of the potential insured
Job promotion of the potential insured
High-paying career of the potential insured