Multiple theories influence dividend policy decisions, which affect the price of a stock. Imagine that you are a stockholder, and choose one of these theories. Thoroughly explain its strengths and weaknesses. Be sure to specifically evaluate the impact of capital structure decisions on stock price within your chosen theory. Also, research at least three  corporate scenarios that represent the theory that you have chosen, and discuss the implications.

 

Answer rating: 100% (QA)

The theory I have chosen to discuss is the signaling theory of dividend policy This theory posits that the amount and stability of dividends paid by a ... View the full answer