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Should the dividend policy be announced? Muntz and Naegle have expressed the opinion that any policy change should be announced. However, Jay and Frink both
- Should the dividend policy be announced? Muntz and Naegle have expressed the opinion that any policy change should be announced. However, Jay and Frink both feel the policy change should not be announced. They cite the company's present position as an illustration of how a firm can become "locked in" by announcing a policy and, thus, forcing the firm to take actions that are otherwise undesirable. Muntz and Naegle on the other hand argue that the shareholders are the owners of the firm and ought to be told what management planned to do. Discuss the advantages and disadvantages of having an announced dividend policy and recommend whether Globex should or should not announce their dividend policy.
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