1. The dividend decision is the third leg of the first principles. if you cannot find investments that make your minimum acceptable (hurdle) rate, cash should be returned to the owners of the business (shareholders). for each of the following denote which is an investment (I) and which is a return of cash (RC) to shareholders?
____INvestment in a new internal project
_____ Acquisition of another company
____Paying off debt
_____ Paying dividends
______ Purchasing stock
2. A high growth company is likely to finance externally with_____ while a mature growth company is likely to finance externally with _____.
a. common stock, debt
b. common stock, common stock
c. Venture capital, debt
d. venture capital, common stock