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Explain the Following as Factor Affecting Dividend Decision: Access to Capital Market - Business Studies

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Explain the following as factor affecting dividend decision:

Access to capital market

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Solution

Access to capital market: Generally, companies having greater access to the capital market are likely to pay higher dividends. This is because they need not rely much on retained earnings. On the other hand, companies with lower access to capital markets are likely to pay lower dividends.

Concept: Financial Decisions - Financing and Dividend
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