It has been argued that it makes no difference whether a firm pays dividends or retains the
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It has been argued that it makes no difference whether a firm pays dividends or retains the earnings, since the value to the stockholders is the same for both.
For example, assuming a 0.4 tax rate and an ability to find a stock that is growing at a before-tax rate of 0.10, if $100 is paid as a dividend, the investor will have after one period
If the funds are retained and invested internally to earn 0.10, and then paid as a dividend after one period, the investor will again have
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Related Book For
An Introduction To Accounting And Managerial Finance A Merger Of Equals
ISBN: 9789814273824
1st Edition
Authors: Harold JR Bierman
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