Questions from Corporate Finance

Q: Explain the similarities and differences of DRIPs, stock dividends, and

Explain the similarities and differences of DRIPs, stock dividends, and stock splits.

Q: What does real-world evidence imply about how firms manage their

What does real-world evidence imply about how firms manage their dividend payments?

Q: Describe the difference between a stock dividend and a cash dividend plus

Describe the difference between a stock dividend and a cash dividend plus a DRIP.

Q: Explain the implications of M&M’s homemade dividend argument.

Explain the implications of M&M’s homemade dividend argument.

Q: Discuss the “bird in the hand” argument in support of

Discuss the “bird in the hand” argument in support of dividend payments.

Q: Explain the transactions motive.

Explain the transactions motive.

Q: According to John Lintner, what is the adjustment factor ß?

According to John Lintner, what is the adjustment factor ß? Interpret the calculated adjustment factor.

Q: How do personal taxes affect preference for high versus low dividend yields

How do personal taxes affect preference for high versus low dividend yields?

Q: Describe the implication of releasing the assumptions of no transactions costs.

Describe the implication of releasing the assumptions of no transactions costs.

Q: CGC Company is considering its dividend policy. Currently CGC pays no

CGC Company is considering its dividend policy. Currently CGC pays no dividends, has cash flows from operations of $10 million per year (perpetual), and needs $8 million for capital expenditures. The...