Discuss whether dividends are relevant to investors, in other words, does it make a difference to...

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Discuss whether dividends are relevant to investors, in otherwords, does it make a difference to an investor if a company paysout dividends or keeps the money and the value of the stock goes upby the same amount. Would it matter to you if you were an investor?Would it matter to the company?

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Recall MM hypothesis In the absence of taxes dividend and dividend policy is irrelevant Hence dividend doesnt create any additional value for the shareholders Reserves and surplus accumulation of companys earnings belong to the shareholders Dividends are paid out from that reserves and surplus which anyways belong to the See Answer

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Discuss whether dividends are relevant to investors, in other words, does it make a difference to...

50.1K

Verified Solution

Question

Finance

Discuss whether dividends are relevant to investors, in otherwords, does it make a difference to an investor if a company paysout dividends or keeps the money and the value of the stock goes upby the same amount. Would it matter to you if you were an investor?Would it matter to the company?

Answer & Explanation Solved by verified expert

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