Based on the so-called bird-in-hand theory

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Reference no: EM13925415

Based on the so-called Bird-in-Hand theory it can be concluded that:

a. Shareholders prefer that companies have high retained earnings.

b. Managers should invest in projects that promise a high return.

c. Companies should pay out dividends.

d. So-called “widows and orphans” should invest in DRIPs.

e. Shareholders do not pay attention to the WACC.

Reference no: EM13925415

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