Discuss the pros and cons of having the directors formally announce a firm’s future dividend policy.
To Explain: Pros and cons of announcing the future dividend policy
Introduction:
Dividend Policy: It is the rules and regulations or protocol, which a company sets to share its earning with its shareholders. Dividend payment includes the payment to be made legally as well as financially.
There is various benefit of pre announcing the dividend policy but the most vital is that it minimizes the investor’s uncertainty.
As it has both negative and positive effect but it is better for the director’s to pre announce the dividend policy.
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