Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Q. Describe the Walters dividend model?
Walter's Model: - Walter's model maintains the doctrine that the dividend policy is relevant for the value of the firm. As-per to the Walter the investment policy of the firm and its dividend policy are interlinked. The major proposition of the Walter approach is the relationship among the following two factors:
(i) The return on firm's investment or else its internal rate of return (r) and (ii) Its cost of capital or the required rate of return (ke) As-per to the Walter approach optimum dividend policy of the firm shall be determined by the relationship between r and Ke.
(i) When Internal Rate of Return is in excess of Cost of Capital (r > Ke):- If the firm's return on investment is in excess of the cost of capital the firm must retain the earnings rather than distributing it to the shareholders for the reason that of the reason that the money is earning more profits in the hands of the firm than it would if it was paid to the shareholders.
(ii) When Internal Rate of Return is beneath Cost of Capital ( r < Ke) :- Alternatively if r is less than Ke the firm must pay off the money to the shareholders in the form of dividends because of the reason that the shareholders can earn higher return by investing it elsewhere.
(iii) If Internal Rate of Return is equivalent to Cost of Capital (r = Ke):- Finally if r is equal to Ke it is a matter of indifference whether the earnings are retained or distributed. For such firms there is no most favourable dividend policy.
Strong form level of Efficiency This level states that price reflects all the available public and private information (past, present and future information). If the hypothesis
Define the P/E valuation method. Under what circumstances should a stock be valued using this method? The P/E ratio points out how much investor are willing to pay for each dol
Advantage of mutual funds Mutual Funds are advantageous to individual investors in relation to their direct involvement in investment portfolio activity covering the following
Q. Importance of Capital Budgeting Decision? 1. Such Decision affect the profitability of the Firm: - Capital Budgeting decision influences the long-term profitability of a fir
Treasuries are the securities that theUS government issues for the completion of government projects. They are of different types like, treasury bills, treasury bon
What its the net income? Total current assets, plant and equipment, net plant and equipment, our net account receivable?
Question 1 Globalization is a process of international integration that arises due to increasing human connectivity as well as the interchange of products, ideas and other aspe
Reston, Inc., has asked your corporation, Pruro, Inc., for financial assistance. As a long-time customer of Reston, your firm has decided to give that assistance. The question you
what is future value
discuss the applicability
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!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd