According to the Text,dividends Are Value-Relevant Even Though the Firm's

question 49

Essay

According to the text,dividends are value-relevant even though the firm's dividend policy is irrelevant.How can that be true? What is the key assumption in the theory of dividend policy irrelevance?

---

Definitions:

Sales Dollars

Revenue generated from the sale of goods and services, expressed in monetary units.

Break-Even

The point at which total costs and total sales are equal, resulting in no net loss or gain.

Common Fixed Expenses

Expenses that do not change with the level of production or sales over a certain period and are shared among different segments or products of a business.

Break-Even

The point at which total costs and total revenue are equal, resulting in no net loss or gain.