Question: Why does a relatively new firm often have a low dividend payout ratio? Why does a firm with a substantial growth record and/or substantial growth

Why does a relatively new firm often have a low payout ratio? Why does a firm with a substantial growth record and/or substantial growth prospects often have a low payout ratio?

Step by Step Solution

★★★★★

3.35 Rating (170 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

A relatively new firm often has a low dividend payout ratio becaus... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (1 attachment)

139-B-A-I (1586).docx

120 KBs Word File

Students Have Also Explored These Related Accounting Questions!

Boo Daddy is a relatively new firm that appears to be on the road to great success. The company paid their first annual dividend today in the amount of $0.15 a share. The company plans to double each...

A relatively low sales to working capital ratio is a tentative indication of an efficient use of working capital. Comment. A relatively high sales to working capital ratio is a tentative indication...

A company with a high dividend payout ratio is a better investment than a company with a low dividend payout ratio. Do you agree? Explain.

9- 9. Financial leverage is the use of financing with a fixed charge. Financial leverage will magnify changes in earnings available to the common shareholder. Its use is advantageous when a firm...

Why does a firm with a substan- tial growth record and/or substantial growth prospects often have a low dividend payout ratio?

Please help solve problem 21-37 in chapter 21. What is the working capital of , 12/31/x1 ? and please help solve problem 21-38 ? thank you 21 Chapter Twenty-One Analyzing Financial Statements After...

What should Singh recommend regarding: the target bond rating the level of flexibility or reserves the mix of debt and equity any other issues you believe should be brought to the attention of the...

Drawing on the financial ratios in case Exhibit 6, how much debt could Deluxe borrow at each rating level? What capitalization ratios would result from the borrowings implied by each rating category?...

What are the main objectives of the financial policy that Rajat Singh must recommend to Deluxe Corporations board of directors? Deluxe Corporation reflecting on the neously, the repurchases, and the...

Using the Internet to do your research, describe a position in a company that you would like to have after five years of work experience. List the requirements that you think would be necessary to...

What is a ratio? How do ratios help to alleviate the problem of size differences among firms?

Cost = $90; Selling price = $216. a. Find the markup. b. Find the rate of markup based on cost

1.124 Find the mean, the median, and the quartiles. What are the mean and the median of the uniform distribution in Figure 1.32? What are the quartiles?

What is the principal disadvantage of the direct method of reporting cash flows from operating activities?

A company advertises that food preparation time can be significantly reduced with the Handy Dandy Slicer. A sample of 12 individuals prepared the ingredients for a meal with and without the slicer.

Global Toys, Inc imposes a payback cutoff of three years for its international investment projects. Assume the company has the following two projects available. What is the payback period for each...

question 1: Assume that both...? question 2: assume that both...? Assume that both populations are normally distributed. Population 1 Population 2 (a) Test whether u, # u2 at the a = 0.01 level of...