Current Attempt in ProgressShareholders of a company may be reluctant to finance expansion through issuing more equity because:Select answer from the options belowleveraging with liabilities is always a better idea.their earnings per share may decrease.the price of the shares will automatically decrease.dividends must be paid on a periodic basis.Save for LaterAttempts: 0 of 1 usedSubmit Answer

Equity is increased by: Group of answer choices dividends. revenues. expenses. liabilities.

A listed company wants to raise money for expansion through issue of additional shares. What are the ways in which it can do that?(1.0 Marks)Rights Issue Or Follow-On Public Offering (FPO)AInitial Public Offers (IPO) Or Bonus IssueBBonus Issue Or Stock SplitCBuyback Of Shares Or By Announcing Special Dividend

Dividend policy of a firm is governed by:(i) Long Term Financing Decision:As we know that one of the financing options is ‘Equity’. Equity can either be raisedexternally through issue of new equity shares or can be generated internally throughretained earnings. For Equity, retained earnings are preferable because they do notinvolve any floatation costs (issue expenses).But whether to retain or distribute the profits, forms the basis of this decision.Further, payment of cash dividend reduces the amount of funds required to financeprofitable investment opportunities thereby restricting its financing options.In this backdrop, the decision is based on the following:1. Whether the organization has opportunities in hand to invest the profit,if retained?2. Whether the return on such investment (ROI) will be higher than theexpectations of shareholders i.e. Ke?

Dividends paid: Group of answer choices increase assets. increase expenses. decrease revenues. decrease retained earnings.

Why do firms prefer not to issue equity?Multiple choice question.New equity increases the liability for dividend payments.Share prices tend to rise when equity is issued.New equity increases the probability of bankruptcy.Share prices tend to drop when equity is issued.