CFA考试资料答案R21 Analysis of Dividends and Share Repurchases - Answers.pdf

Question #1 of 66 Question ID: 1209376 Which of the following would be least likely to prompt a decline in a companys overall payout ratio? A) An increase in interest rates. B) A decrease in the capital gains tax rate. C) A permanent decrease in company protability. 7 3 Explanation CFA/FRM studying materials,WeChat:musiq1237 2 1 q A permanent decrease in prots is expected to result in a decrease in the dividend payment level; i however this would probably not lead to a decrease in the payout ratio. If interest rates were to s increase, it would make retained earnings a more attractive way of nancing new investment; as a u m result, the payout ratio would be more likely to decline. A decrease in the capital gains tax rate would : (for investors that pay tax) make capital gains more appealing; accordingly, aggregate payout ratios t a would be expected to decline.