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Fully explain how firms should return cash to shareholders? How are these decisions made, and what...

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Finance

Fully explain how firms should return cash to shareholders? Howare these decisions made, and what factors are considered in thefirm's payout decisions?

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Firms should return cash to its shareholders in the following ways 1 Cash Dividends This is the most simplest method of returning cash to the shareholders and is often done as a special interim dividend 2 Share Buy Back This route is through when the company is offering to buy back its shares from the shareholders Shareholders participation is their right but not the obligation 3 Reduction of Capital Both the above methods of returning cash to the shareholders is done when the company has profits but if it does not have profits    See Answer
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Fully explain how firms should return cash to shareholders? Howare these decisions made, and what factors are considered in thefirm's payout decisions?

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