A company wants to return funds without signaling that all future dividends will be raised abnormally. Which of the following is the simplest method to adopt?

Question

Quizplus · Accepted Answer

Special dividends are one-time payments made to shareholders, typically financed by the company's surplus cash or profits. By using this option, the company can return funds without signaling a commitment to raising dividends in the future, as it is a one-time payment rather than a recurring increase in dividend payouts.

A Company Wants to Return Funds Without Signaling That All