Please help with the following questions Vick shipping paid a divident of $1.50
ID: 2702207 • Letter: P
Question
Please help with the following questions
Vick shipping paid a divident of $1.50 last year, and its dividend has increased steadily by about 4% a year. Vick just announced that its dividend will increase to $2.10 this year, and its stock price rose from $26 to $28 immediate after the announcement. Which of the following best explains why the price inncreased as it did?
(a). the signaling hypothesis
(b). the residual dividend model
(c). The clientel effect
(d). M-M dividend irreleance
Which class of investors is more likely to be pleased by Vick's dividend announcement?
(a.) Investors with low tax rates who depend on current dividend income for living expense
(b). Investors was high tax rates who doent depend on current dividend income for living expenses
Suppose a firm generates a lot of cash but has limited investment opportunities. Is this stock more likey to be a utility stock or a technology stock? And is the stock likey to have a high or low dividend yield?
(a). Probably a utility stock that has a low dividned yield
(b). Probalby a utility stock that has a high dividend yield
(c). Probalby a technology stock that has a low dividend yield
(d). Probably a technology stock that has a high dividend yield
Explanation / Answer
(a.) Investors with low tax rates who depend on current dividend income for living expense
A firm's __past__ dividend policy determines its current clientele of investors.