Determine dividend payout ratio of the firm as management

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a. Explain and prove irrelevance of dividends theory of Modigliani and Miller with comparison between current dividend payments and earnings retention. How the investors value remains same in both decisions.

b. A company had a large proportion of inside ownership and volatile earnings, all of whom are high-income individuals. Would you expect it to have a low, medium, or high dividend-payout ratio? Explain why.

c. Explain all factors that determine dividend payout ratio of the firm as management decision? Explain with reasons how those factors increase or decrease dividend payout ratio?

Reference no: EM132575071

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