Indicate whether its TRUE or FALSE. Then give an explanation. Firms concerned with the sharemarket reaction to dividend announcements may adopt a “sticky” dividend policy
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Indicate whether its TRUE or FALSE. Then give an explanation.
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Firms concerned with the sharemarket reaction to dividend announcements may adopt a “sticky” dividend policy.
Step by step
Solved in 2 steps
- 1. Is stock bonus a real dividend payment in principle? 2. Briefly describe the information signaling effect caused by dividend reduction announcement (in terms of assumption and market reaction)One of the reasons why firms pay dividends is that dividends payments can be a signal to the market. Explain.)How would you relate information asymmetry to firm’s dividend policy?
- The optimal distribution strategy achieves a balance between capital gains and current dividends in order to raise the stock price of the company. true or falseIndicate whether the following statements are true or false. If the statementis false, explain why.e. A company that has established a clientele of investors who prefer largedividends is unlikely to adopt a residual dividend policy.The idea that changes in dividend policy reflects managers' views about the firm's future earnings is known as: a) Modigliani and Miller Theory b) Payoff Theory c) Dividend Signaling Hypothesis d) Pecking Order Hypothesis
- There are various methods and techniques to pay dividend to shareholders.How would these techniques/methods helpful for management to cope with market competition and increase profit. Note: Please elaborate your answer with hypothetical numerical examples?Describe the two possible market signals that investors perceive from a firm announcing an increase in its dividend payments to shareholders.Corporate managers sometimes use dividends as a tool for communicating with the market. Discuss.
- Is a company's dividend policy payment important? Please explain why or why notIf a large group of investors tend to buy a company's stock, an individual might follow too. This statement is an example of: Select one: Self-attribution Mental Accounting Herd Behavior The disposition effects AnchoringTo what extent does the company’s dividend policies support or hinder their strategies? For example, if the company is attempting to grow, are they retaining and reinvesting their earnings rather than distributing them to investors through dividends? Be sure to substantiate claims.