The following table lists some factors that might affect an investor's preference for dividends. Indicate whether the given factors are likely to make an investor prefer to receive more or fewer dividends.

$\backslash$table$[[$Factor$],[$When investors receive dividends today, they may choose to reinvest or to consume goods.$],[$The value of a dividend received today is known, but the value of a capital gain received in the future is$],[$uncertain$.],[$When an investor dies, his or her heirs are not liable for taxes on the capital gains generated during the$],[$investor$\text{'}$s life. They are only liable for the capital gains earned since the investor's death.$]]$

In examining investors' preferences for dividends, it is useful to begin with the concept of dividend irrelevance. Dividend irrelevance suggests that in a world with no taxes or brokerage $($or transaction$)$ costs, firms and investors are indifferent to the paying or receiving of dividends.

However, as these restrictions are relaxed, various factors suggest that firms should pursue high or low payouts. One such factor is:

Dividends received far into the future are significantly more uncertain than dividends received in the near future.

Based on the factor described, identify whether investors, in general, will tend to favor high or low payout ratios.

Favor a high payout

Favor a low payout