The Wall Street Journal reported that shareholders of Kraft Foods, now part of KraftHeinz, "can afford to give management more time to improve its brands, sales margins, and earnings" because of the dividends paid by the company and the share buyback program. The company has been losing market share in its cheese and processed-meat product categories and has not been keeping up with private-label competition, as well as new food offerings in healthy snacks and foods. However, due to the dividends and buybacks, share price appreciation is not the only form of return to the investors.

INSTRUCTIONS:
a. How does a shareholder earn a return on his or her investment in a company?
b. Do companies that pay dividends have creation advantage over companies that do not pay dividends and choose to retain all earnings?
c. What signs should investors look for to see if Kraft's management is successful in its strategy? Where in the financial statements will this evidence be presented?