Aswath Damodaran 476
! Application Test: Assessing your firm’s dividend policy
! Compare your firm’s dividends to its FCFE, looking at the last 5 years of
information.! Based upon your earlier analysis of your firm’s project choices, would you
encourage the firm to return more cash or less cash to its owners?! If you would encourage it to return more cash, what form should it take
(dividends versus stock buybacks)?