Question
Hello, I need your support to solve below task, First you should explain the relationship between dividends and stock prices with reference to the dividend
Hello, I need your support to solve below task,
First you should explain the relationship between dividends and stock prices with reference to the dividend discount model. As dividends are of two types i.e. cash dividends and stock dividends, what are the reasons for giving either type of dividends and does giving of such dividends affect the stock price? In your answer also bring in the discussion about dividend yield and dividend payout ratio. Link in your answer a discussion of profits and retained earnings with dividends. Should you buy shares of firms that pay dividends or should you buy growth stocks; are firms that pay high dividends good or those that pay low dividends why?
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