Dividend Policy - Subjective Question

1. Discuss the key factors that influence a company's decision to pay dividends or retain earnings.
2. Explain the significance of the dividend irrelevance theory proposed by Modigliani and Miller. How does it impact a firm's dividend policy?
3. Compare and contrast the residual dividend policy and the stable dividend policy. What are the advantages and disadvantages of each?
4. What role does the clientele effect play in shaping a company's dividend policy? Provide real-world examples to support your answer.
5. Discuss the impact of different dividend policies on a firm's stock price and overall shareholder wealth."
6. Examine the factors that could lead a company to implement a high-dividend payout policy. How might this choice affect the firm's growth prospects?
7. In the context of dividend policy, what is meant by the 'bird-in-the-hand' argument? How does it relate to investor preferences and the perception of risk?
8. Explain the concept of dividend signaling and how it influences a company's dividend decisions. Provide examples of positive and negative signaling.
9. Discuss the concept of tax clientele and how it can influence a company's dividend policy decisions. What implications does this have for investors?
10. In times of financial distress, should a company prioritize maintaining its dividend payments or conserving cash? Justify your answer with relevant theories and practical considerations.