Assignment: Financial Decision-Marking
Case Study: Dividend Policy at FPL Group, Inc.
Suggested Assignment Questions:
1. Why do firms pay dividends? What, in general, are the advantages and disadvantages of paying cash dividends?
2. What are the most important issues confronting the FPL Group in May 1994?
3. From FPL's perspective, is the current payout ratio appropriate? Would a higher payout ratio be more appropriate? A lower payout ratio?
4. From an investor's perspective, is FPL's payout ratio appropriate?
5. As Kate Stark, what would you recommend regarding investment in FPL's stock - buy, sell, or hold?
6. As a member of FPL's executive board, would you recommend cutting the dividend, suspending the dividend, raising the dividend, or leaving the dividend as is?
7. How vulnerable is FPL to power industry regulation changes?
8. What factors other than cash flow affect a firm's decision regarding dividend payments?
9. Are there agency conflicts that could impact management's dividend decision? If so, might management be less inclined to maximize shareholder value? Or could management have an ulterior motive?
Format your assignment according to the following formatting requirements:
1. The answer should be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides.
2. The response also include a cover page containing the title of the assignment, the student's name, the course title, and the date. The cover page is not included in the required page length.
3. Also Include a reference page. The Citations and references should follow APA format. The reference page is not included in the required page length.