One of John Lintner's conclusions in his classic study of dividend policy is that managers do not

Question:

One of John Lintner's conclusions in his classic study of policy is that managers do not seem to change payment in response to capital requirements for new investment (Lintner, J., 1956, "Distributions of incomes of corporations among dividends, retained earnings and taxes," American Economic Review 46, 97-113). Consider this finding in light of the chapter discussion.
Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...