What is the likely impact of a highly inflationary economy on a firms ability to pay dividends?

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What is the likely impact of a highly inflationary economy on a firm’s ability to pay dividends? Would you expect this impact to be greater or smaller for a rapidly expanding firm? Why?

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Contemporary Financial Management

ISBN: 9780324289114

10th Edition

Authors: James R Mcguigan, R Charles Moyer, William J Kretlow

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Question Posted: Jul 17, 2012 04:03 AM

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What is the likely impact of a highly inflationary economy on a firms ability to pay dividends?

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In an inflationary environment a firm may find that funds generated by the depreciation tax shie...View the full answer

Contemporary Financial Management

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