Stockholders who seek capital gains prefer a large payout ratio.

Name: Stockholders who seek capital gains prefer a large payout ratio.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Stockholders who seek capital gains are more interested in the company reinvesting its profits for future growth opportunities rather than distributing them as dividends in the form of a large payout ratio. They believe that the reinvestment leads to an increase in the stock price, which results in capital gains for the stockholders.

Stockholders Who Seek Capital Gains Prefer a Large Payout Ratio