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One Potential Rationale for Paying Dividends Is That the Payment

question 90

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One potential rationale for paying dividends is that the payment of dividends indirectly results in a closer monitoring of management's investment activities,hence lowering agency costs.


Definitions:

Total Product

The total output of goods or services produced by a firm over a given period of time.

Marginal Product

Marginal product is the additional output gained from increasing one unit of a variable input, holding all other inputs constant, in the production process.

Total Product

The total quantity of output that a firm produces with a given amount of fixed and variable inputs during a specified period.

Total Product

The total quantity of output that a firm produces, usually within a given time period.

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