In some countries, such as Australia, it is common for corporations to offer shareholder a dividend...

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Finance

In some countries, such as Australia, it is common forcorporations to offer shareholder a dividend investment scheme.
(a) Discuss the advantages of a dividend reinvestment plan fromthe point of view of the corporation and the shareholders.
(b) Under what circumstances might such schemes prove to beunattractive to the dividend paying company.

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A Advantages of Dividend Reinvestment plan For Corporations 1 Funds requirement can be fulfilled and this fund can be used elsewhere which otherwise they might to pay to the investors 2 This fund fulfills the cash requirement without See Answer

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In some countries, such as Australia, it is common forcorporations to offer shareholder a dividend investment scheme.(a) Discuss the advantages of a dividend reinvestment plan fromthe point of view of the corporation and the shareholders.(b) Under what circumstances might such schemes prove to beunattractive to the dividend paying company.