Corporate dividend policies

Assignment Help Finance Basics
Reference no: EM1373182

Here are many assertions about typical corporate dividend policies. Which of them are true? Write out a corrected version of any false statements.
[A] Most companies set a target dividend payout ratio.
[B] They set each year's dividend equal to the target payout ratio times that year's earnings.
[C] Managers and investors seem more concerned with dividend changes than dividend levels.
[D] Managers often increase dividends temporarily when earnings are unexpectedly high for a year or two.

For each of following 4-groups of companies, state whether you would expect them to distribute a relatively high or low proportion of current earnings and whether you would expect them to have a relatively high or low price-earnings ratio.
[A] High-risk companies.
[B] Companies that have recently experienced a temporary decline in profits.
[C] Companies that expect to experience a decline in profits.
[D] "Growth" companies with valuable future investment opportunities.


Reference no: EM1373182

Previous Q& A

  Find the total risk of the portfolio

Two securities, Security A and Security B, with standard deviation of 30% and 40 percent, respectively. Compute the standard deviation of a portfolio weighted equally between two securitites if their correlation is;

  Caluing business opportunities

Suppose that the role of finance section at Strident Marks. The finance section has a couple of new hires, and the CFO has asked that you spend a short amount of time with them,

  Determine the yield on a treasury bond

The market expects that inflation will be 3% each year for the next five years and then the following years will average 5% a year.

  Social security reform became law

Assume that the following Social Security reform became law; All current Social Security recipients will continue to earn their profits, but no increase will be made other than cost of living adjustments;

  Undercover in a chicken factory

The attached article is about a field study in Arkansas. Discuss the cultural identity and the conditions of the newest wave of immigrants into the US and Arkansas.

  Find market value of the bonds

The Bonds of Microfood, Inc. carry a 10 percent annual coupon, have a $1,000 face value, and nature in 4 years. Bonds of equivalent risk yield 7 percent.

  Market portfolio using the capital market line

A portfolio that combines the risk-free asset and the market portfolio have an expected return of 25% and a standard deviation of 4%. The risk-free rate is 5%, and the expected return on the market portfolio is 20%.

  Difference between the book value and market value

We discussed cash flow in DQ1. Another measure of value is the firm's assets less liabilities or investor's equity. We call this book value of the company.

  What is the deadweight loss from the quota

What are the losses to U.S. consumers, gains to U.S. producers, and deadweight loss and what quota level would have the equivalent effect on price as the $6 tariff

  Question about dividend policy

For each of the following 4-groups of companies, state whether you would expect them to distribute a relatively high or low proportion of current earnings and whether you would expect them to have a relatively high or low price earnings ratio.


Write a Review


Similar Q& A

  Compute an exponential smoothing forecast

The Oceanside hotel is adjacent to city coliseum, a 24,000-seat arena that is home to city's professional basketball and ice hockey teams and that hosts a many concerts, TV shows.

  Define diversification and its necessity in risk management

What steps can this company take to diversify its portfolio? Define diversification and its necessity in risk management. Discuss at least 5 steps to diversify the card business.

  Explain how u.s. financial markets impact the economy

Explain the role of the United State Federal Reserve, Federal Reserve Chairman, & Board, indicating its effectiveness in today's economic environment. Provide support for rationale.

  Present value of funding annuity

Find out the annual payment required to fund the future annual annuity of $12,000 per year. You will fund this future liability over the upcoming five years, with the first payment to take place one year from today.

  Analyze the futures market

Analyze how the futures market has developed in areas.

  Calculation of debt ratio and total asset turnover ratio

Calculation of Debt Ratio and Total Asset Turnover Ratio and Compute the following ten financial ratios and provide a one sentence explanation of the analytic use of each ratio test. Show your formulas and input.

  Find the risk premiums for each factor

Assume stock returns can be explained by a two-factor model information for two diversified portfolios. The risk free rate is 4%

  How did the forward premium changes

Find the month forward rate of the euro exhibited a discount or premium this morning and how did the forward premium changes this afternoon?

  Earmark funding and appropriations

Does The American Red Cross receive or has ever received earmark grants?

  Cash dividends and stock repurchase

Assume instead of paying the cash dividend, the firm used the $2.4 million of excess funds to purchase shares at slightly over the current market value of $64 at a price of $65.20. How many shares could be repurchased?

  Prepare journal entries to record transactions

Make journal entries to record the following transactions relating to long-term bonds of XYZ, corporation and Show all calculations.

  Evaluation of foreign currency

Computation of Foreign Currency - Hedging with forward contracts and find the variance of the dollar price of this asset if the U.S. firm remains unhedged against this exposure?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd