It is assumed that the Cost of equity and rate of return are both constant under Walter’s Model of Dividend Relevance, if the cost of equity is higher than the rate of return, it is optimal that The firm is indifferent as to distribute dividends or to reinvest the income None of the choices is correct. No dividend to be given to shareholders All the earnings for the period shall be distributed to shareholders
It is assumed that the Cost of equity and rate of return are both constant under Walter’s Model of Dividend Relevance, if the cost of equity is higher than the rate of return, it is optimal that The firm is indifferent as to distribute dividends or to reinvest the income None of the choices is correct. No dividend to be given to shareholders All the earnings for the period shall be distributed to shareholders
Chapter17: The Management Of Cash And Marketable Securities
Section: Chapter Questions
Problem 2P
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Bulldogs Inc. maintains a cash buffer for unexpected cash outlays for the year amounting to 3,000. Bank of Wildcats charges Bulldogs P15 for every transaction with the bank. The bank grants 5% annual interest. Bulldogs is contemplation if it will still need to have the cash buffer. How much is the annual savings in annual holding cost of cash for Bulldogs if it will not have a cash buffer?
It is assumed that the Cost of equity and rate of return are both constant under Walter’s Model of Dividend Relevance, if the cost of equity is higher than the rate of return, it is optimal that
The firm is indifferent as to distribute dividends or to reinvest the income
None of the choices is correct.
No dividend to be given to shareholders
All the earnings for the period shall be distributed to shareholders
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