Mr. Gabbar Singh, chairman of Kaliaa & Co., is in need of your advice for dividend policy of his company. He has hired three independent consultants and he was advised for three different dividend policies to be adopted by his ompany. These policies are No dividend Maximum dividend 1. Any dividend as there is no rationality.

Explain theories in favor of three different dividend policies suggested. o Marks1 Theory in support of 'No dividend' Theory in support of 'Maximum dividend' Theory in support of 'Any dividend as there is no rationality' His company has history of paying high dividend for last fifty years. What will e your advice?

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Theory in support of No dividend The theory of the Irrelevance Theory argues that a companys dividend policy does not affect its value and therefore a ... View the full answer