1.What are some of the factors that common stockholders consider when deciding how much, if any, cash dividends they desire from the corporation in which they have invested?
2.What is the Modigliani and Miller theory of dividends? Explain.
3.Do you believe an increased common stock cash dividend can send a signal to the common stockholders? If so, what signal might it send?
4.Explain the bird in the hand theory of cash dividends.
5.What is the effect of stock (not cash) dividends and stock splits on the market price of common stock? Why do corporations declare stock splits and stock dividends?