Which of the following is NOT a reason for a high-dividend-payout policy?

Question

Quizplus · Accepted Answer

Higher potential future returns for shareholders is not a reason for a high-dividend-payout policy as high dividend payouts typically result in lower retained earnings, which can limit a company's ability to reinvest in future growth opportunities and achieve higher potential returns for shareholders in the long run. A high-dividend-payout policy is typically pursued for reasons such as providing convenient and direct cash payments to shareholders, avoiding transaction costs for selling shares, and providing cash payments today versus uncertain payments tomorrow.

Which of the Following Is NOT a Reason for a High-Dividend-Payout