Question: a. Define Active Dividends Policy. Explain with help of Bird in Hand Theory, Clientele Effect Theory and Tax Effect Theory? b. What is financial signaling

a. Define Active Dividends Policy. Explain with help of Bird in Hand Theory, Clientele Effect Theory and Tax Effect Theory? b. What is financial signaling as it relates to cash dividends, stock dividends, and stock repurchase? Justify and explain with reasons that why either positive or negative financial signal impact is generated on cash dividends, stock dividends, stock repurchase? c. Explain how protective covenants and ability to borrow factors affect dividend payout ratio of the firm as management decision? Explain with reasons how those two factors increase or decrease dividend payout ratio

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