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    Dividend Irrelevance Question

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    Please help with the following problem involving dividend irrelevance.

    Dividend Irrelevance. You own 2,000 shares of patriot Corporation, which is about to raise its dividend from $.75 to $1.00 per share. The share price is currently $100. You would prefer that the dividend remain at its current level.

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    Solution Preview

    Problem: Dividend Irrelevance. You own 2,000 shares of patriot Corporation, which is about to raise its dividend from $.75 to $1.00 per share. The share price is currently $100. You would prefer that the dividend remain at its current level.

    Solution:
    The dividend irrelevance theory states that investors are not concerned with dividend policy because they can sell a portion of their holdings if they need cash.
    http://www.investopedia.com/terms/d/dividendirrelevance.asp?viewed=1

    Another possible ...

    Solution Summary

    The solution presents three cited definitions of dividend irrelevance followed by four possible solutions to maintain the dividend at a level amount. Step by step calculations are provided.

    $2.19

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