Use the Information for the Question(s)below

question 82

Essay

Use the information for the question(s)below.
Iota Industries is an all-equity firm with 50 million shares outstanding. Iota has $200 million in cash and expects future free cash flows of $75 million per year. Management plans to use the cash to expand the firm's operations, which in turn will increase future free cash flows by 12%. Iota's cost of capital is 10% and assumes that capital markets are perfect.
-What impact did the introduction of a dividend imputation system have on Australian firms' financial policies?
_____________________________________________________________________________________________
_____________________________________________________________________________________________

---

Definitions:

Gestalt Psychology

A theory in psychology that proposes the human mind considers objects in their entirety before, or in parallel with, the perception of their individual parts.

Psychological Phenomena

Events, behaviors, or processes that relate to the mind and are exhibited through actions, thoughts, or emotions.

Entirety

The whole of something; the total or complete sum or amount of a particular thing or entity.

Nativism

The theory that certain skills or abilities are "native" or hardwired into the brain at birth.