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in Business Studies by (66.9k points)

On the one hand investors in general, view an increase in dividend as good news and stock prices react positively to it but on the other hand the Companies Act places certain restrictions as payouts as dividend. These restrictions must be adhered to while declaring the dividend. 

(a) Identify the factor affecting dividend division under which investors consider an increase in dividend as a good news. 

(b) Identify the value which is being emphasized by the Companies Act in placing certain restrictions as payouts as dividends. 

(c) Identify the value which is being emphasized when company declares dividend as per the provisions of the Companies Act. 

1 Answer

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Best answer

(a) Stock market reactions 

(b) Safety 

(c) Respect for law

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