Stock and Cash Dividends
Historically, the firm has paid generous cash dividends. The firm recently
announced that it would replace its cash dividend with a 20 percent annual
stock dividend.
Answer the following:
a) Is this good news, bad news, or is it impossible to tell
from the information provided? Explain the reason for your answer.
b). Why do many firms choose to issue stock dividends?
c). What is the value of a stock dividend?





