Corporate Finance: Instructor\'s Manual Applied Corporate Finance

Aswath Damodaran 475

Summing up...

ROE - Cost of Equity

Cash Returned < FCFE

Cash Returned > FCFE

Poor Projects Good Projects

Faclecxuimbiluiltayt (^) eto
cash
Cut payout
Invest in Projects
Increase payout
Reduce Investment
Cut payout
Reduce Investment
Figure 11. 5 : Analyzing Dividend Policy
Aracruz
Disney Microsoft

Summarizes the discussion from the last few pages...