If a company were to increase dividends what would each, Financial Management

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If a company were to increase dividends what would each

If a company were to increase dividends, what would each theory predict to happen to security prices and why?

Signaling Theory of dividends:

Stock prices:

Bond prices:

Agency Cost Theory of dividends (also known as inside-outside stockholder agency cost):

Stock prices:

Bond prices:

Risk Shifting Theory of dividends (better known as stockholder-bondholder agency cost):

Stock prices:

Bond prices:

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