Which of the following will be a source of cash flows for a shareholder of a certain stock?
I. Sale of the shares at a future date
II. The firm in which the shares are held paying out cash to shareholders in the form of dividends
III. The firm in which the shares are held increasing the total number of shares outstanding through a stock split
A) I only
B) II only
C) I and II
D) II and III

Question

Quizplus · Accepted Answer

Selling shares and receiving dividends are direct sources of cash flows for shareholders. A stock split does not provide cash flow.

Which of the Following Will Be a Source of Cash