please answer parts a,b,c,d,e,f,g

DIVIDEND POLICY Southeastem Steel Company (SSC) was formed 5 years ago to exploit a rrow con tinuous casting process. SSC's founden. Donald Browil and Margo Valencia, had been employ 5 in in the the new process (which Brown and Valencia had developed). they decided to strike out on thech onvis our advantage of the new process was that it required relatively litte capital compared to the tymagi atizl company, so Brown and Valencia have been able to avoid fssing new stock and thus own all of ihe oheres Howaver. SSC has now rached the stage in which outsite equity capital is necesary if the firmin is in achieve its growih targets yet still maintain its target capital structure of 60th equaty. and fid deby Therefore, Brown and Valencia have decided to take the compary public. Unth now, Brown amd Vahisiar have paid themselves reasonable salaries but routinely reinvested all after-tax earnings in the ficming and he firm's dividend policy has not been an issue. However, before talking with poteotial outside. inveriors. they must decide on a dividend policy. and atiscaes the following questions: 1. What is meant by the tern drthifend policy? 2. Explain briefly the dividend irnelevance theory that was put forward by Modigliani and Moller Whar were the key assimpticis undertying their theory? 1. Why do seme investors prefer high-dividend paying stocks, whale other invertars profer atreke that puy low of noeiekistent dividends? b. Discus (1) the information confent, or stgnaling, hypotlwesis: (2) the clicntele elfect; (3) catering theory and (4) their effects on dividend policy 1.. 1. Awume that SSC, has an S800,om0 capital budget planned for the coming year. You have deternined that its present captal structure (60/4 eguaty and 40% debt) is optimale and its net incocme is forceasted at so00,000. Use the residtasl dividend model to determine 58 C's total dollar dividend and payout ratio li the procesc, explain how the residual dividend moded works- Them explain what would happent if expected net income was $400,000 or $800,000. 2. In general terms, how would a change in investment opportunities affect the payout ratoo unaler ihe residial dividend model? 3. What ane the advantages and divadvantages of the residual policy? (Hint: Don't meglect aignating and cliemtele effects.) b. Discuss (1) the information content, or signaling, hypothesis; (2) the clientele effect: (3) catering theory: and (4) their effects an dividend policy. c. 1. Assume that SSC has an $800,000 capital budget planned for the coming year. You have determined that Ats present capital structure (60\% equity and 40% debt) is optimal, and its net income is forecasted at $600,000. Use the residual dividend model to determine SSC's total dollar dividend and payout ration in the process, explain how the residual dividend model works. Then explain what would happen if expected net income was $400,000 or $800,000. 2. In general terms, how would a change in investment opportunities affect the payout ratio under the 3. What are the advantages and disadvantages of the residual policy? (Hint: Don't neglect signaling and residual dividend model? clientele effects.) d. Describe the series of steps that most firms take in setting dividend policy-in practice. c. What is a dividend reinvestment plan (DRIP), and how does it work? f. What are stock dividends and stock splits? What are the advantages and disadvantages of stock dividends and g. What are stock repurchases? Discuss the advantages and disadvantages of a firm's repurchasing its own stock splits? shares