Tom and Harry are friends. Tom was injured in an accident and received a settlement. He is living off the invested amount from that settlement, since he is no longer able to work. Harry is saving money to buy a boat, something he has wanted all his life and is anxious to get as soon as he has saved enough to pay for it. Based only on transaction costs (not taxes or other factors), which of these two investors would fit into a clientele that prefers stocks with high dividend payout ratios over non-dividend-paying stocks? A. We can’t say, since the concept of a clientele can be applied only to personal taxes, not to transaction costs. B. Harry, saving for a boat, is more likely to be in the high dividend clientele. C. Both are equally likely to fall into this clientele D. Tom, living off his settlement, is more likely to be in the high dividend clientele.
Tom and Harry are friends. Tom was injured in an accident and received a settlement. He is living off the invested amount from that settlement, since he is no longer able to work. Harry is saving money to buy a boat, something he has wanted all his life and is anxious to get as soon as he has saved enough to pay for it. Based only on transaction costs (not taxes or other factors), which of these two investors would fit into a clientele that prefers stocks with high dividend payout ratios over non-dividend-paying stocks? A. We can’t say, since the concept of a clientele can be applied only to personal taxes, not to transaction costs. B. Harry, saving for a boat, is more likely to be in the high dividend clientele. C. Both are equally likely to fall into this clientele D. Tom, living off his settlement, is more likely to be in the high dividend clientele.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Tom and Harry are friends. Tom was injured in an accident and received a settlement. He is living off the invested amount from that settlement, since he is no longer able to work. Harry is saving money to buy a boat, something he has wanted all his life and is anxious to get as soon as he has saved enough to pay for it. Based only on transaction costs (not taxes or other factors), which of these two investors would fit into a clientele that prefers stocks with high dividend payout ratios over non-dividend-paying stocks?
We can’t say, since the concept of a clientele can be applied only to personal taxes, not to transaction costs.
Harry, saving for a boat, is more likely to be in the high dividend clientele.
Both are equally likely to fall into this clientele
Tom, living off his settlement, is more likely to be in the high dividend clientele.
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