- Question 9 The Shares Of Amc Plc Are Currently Quoted At 200p Per Share And The Company Has Been Paying A Dividend Of 30 1 (63.04 KiB) Viewed 44 times
- Question 9 The Shares Of Amc Plc Are Currently Quoted At 200p Per Share And The Company Has Been Paying A Dividend Of 30 2 (53.48 KiB) Viewed 44 times
Question 9 The shares of AMC plc are currently quoted at 200p per share and the company has been paying a dividend of 30p per share for the last 10 years. The company is planning to retain the next three years' dividends to invest in a new project. The project's cash flows will begin in year 4, allowing the company to pay an increased dividend of 40p per share from that year onwards. How much would the share price change? A. -24.4p per share B. -14.2p per share 7 C. 5.8p per share D. 10.2p per share
Question 10 Which of the following is the correct statement of the conclusion of Modigliani and Miller on the relevance of dividend policy? A. Increase in retentions result in a higher growth rate B. All shareholders are indifferent between receiving dividend income and capital gains C. The value of the shareholders' equity is determined solely by the firm's investment selection criteria D. Discounting the dividends is not an appropriate way to value the firm's equity