All else the same, an investor is likely to prefer a ﬁrm with a high dividend payout if the ﬁrm's
dividend payout is restricted by a bond indenture.

Name: All else the same, an investor is likely to prefer a ﬁrm with a high dividend payout if the ﬁrm's dividend payout is restricted by a bond indenture.
Brand: Quizplus
Rating: 4.8 (52 reviews)

Question

Quizplus · Accepted Answer

A bond indenture restricting dividend payouts typically indicates that the firm must prioritize debt obligations over dividends, which may not be attractive to investors seeking high dividends.

All Else the Same, an Investor Is Likely to Prefer