For each of the companies described below, would you expect it to have a medium/high or a
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For each of the companies described below, would you expect it to have a medium/high or a low dividend-payout ratio? Explain why.
a. A company with a large proportion of inside ownership, all of whom are high-income individuals.
b. A growth company with an abundance of good investment opportunities.
c. A company experiencing ordinary growth that has high liquidity and much unused borrowing capacity.
d. A dividend-paying company that experiences an unexpected drop in earnings from a trend.
e. A company with volatile earnings and high business risk.
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