Carry out your own research to find a non-financial firm that changed Essay

Carry out your own research to find a non-financial firm that changed its dividend policy over the last few years. Assess the (p - Essay Example One of the key theories that explain the relationship between dividend policy and stock price is the irrelevance of dividend policy, in which Miller and Modigliani (1961) suggest that dividend policy is immaterial when it comes to determination of the shareholders’ wealth. They specifically argued that, without considering market imperfection and taxes; the shareholders’ wealth is not affected in any way. Hakansson (1982) supported the views of Miller and Modigliani by maintaining that dividend do not play any role in the value of the firm, regardless of whether they are informative or not; but this applies only when investors possess time additive utility and homogenous belief as well as when the market is fully efficient. Different empirical studies associated with dividend theory policies do not show consistent results. As such, it is not possible to give a general view as to whether the investors prefer dividend or capital gain. Brigham (2010) asserts that it is the prerogative of the management to decide the dividend policy based on industry trends and the long-term objectives of the organisation, a view that squarely explains the reasons why the management of Apple has dramatically changed its dividend policy. Even so, it is imprudent for the management to rely on any specific theory in determination of dividend policy for the corporations they head, because the best policy depends on different circumstances and times. Irrelevance theory is neutral with regard to preference of either capital gain or dividend payout (Miller and Modigliani, 1961). In this model MM concluded that capital structure does not have any effect on the value of the firm. However, MM II, argued that by introducing corporate taxes in to the first model, it gives rise to tax shields which in turn leads to optimal capital structure (Black, 2006). The paper puts into perspective the issue of dividend policy in the context of Apple Inc. The paper also gives a brief overview of the company, as well as putting into perspective the imminent change in divided policy that has been lined up, and those that have already been implemented. The analysis will also incorporate different theories that have been put across by several researchers regarding the relationship between dividend policy and share price volatility. Company Overview The Apple Company designs, manufactures and markets computers, networking solutions, software, peripherals and services. Among the many available products are portable music players, which they both design and develop. Notwithstanding, they engage in online distribution of television shows, audio books, short films, third-party music-both audio and videos. Apple Inc. (Apple) was founded by Stephen Wozniak and Steve Jobs in the latter’s garage. January 3, 1977 saw the incorporation of Apple. The Apple II computer was then later introduced by the duo later that year at a West Coast Computer Fair in San Francisco (Linzmayer, 1999). Dividend Policy Trend in the Technology Industry Distribution policy refers to Companies’ policies put in place to govern issues of dividend payout. For instance, a company can have either high or low dividend distribution policy to its both preference and ordinary

The Uses and Gratification Theory Case Study Example | Topics and Well Written Essays - 4000 words

The Uses and Gratification Theory - Case Study Example In previous eras, the main sources of entertainment for people tended to be festivals dedicated either to harvesting or in praise of one god or another. In the western perspective, this came to be replaced by theatre and with the modern age came the development of television and the television networks which continue to offer a wide variety of visual entertainment. The advancement in technology has increased the demand for entertainment from individuals, and because of the wide variety of entertainment being offered, it is not a surprise that many of the entertainment companies involved are competing heavily to capture audiences. Because of this, the audience has gained great influence in controlling the type of media they would like to view, and this can be likened to the individual’s lifestyle as well as mindset (Napoli, forthcoming). From the very beginning of the development of media, the main question that has concerned the developers is whether the media has any influenc e on the audience. It has been proven that different types of media can influence the audience, so that in some cases when an individual sees an advert of a product on television, he or she will likely purchase the product. On the other hand, there are those of the view that media has no great influence on its audience since it is they who choose what to watch (Allison, 2006). This article makes a focus on the motives behind the choice of a particular media type as a basis of the Theory of Audience especially uses and Gratification theory. In the past few decades, the invention and development of the internet have revolutionized the lives of many people in the world and one would argue that it is one of the biggest developments in mass media. Every decade of the twentieth century presented its own theories concerning media communication, and while at the beginning, it was thought that media had an effect on the audience, later with the advancement in media communication, researchers found that audiences only used media for their own benefit (Rossi, 2002). Theory of Audience Uses and Gratifications Katz first proposed the theory of Uses and Gratification and the notion behind this theory is, it focuses on a question of why and how people use particular media. In contrast to the effect model view which is what media do with people, U & G is considered as a broader aspect among media researchers who are more concerned about finding what people do with a media (Chandler,1994). This theory is contradictory to the older approach of Audience of a passive group. This theory views the audience as an active group which means individuals have power and selects that media text that best suits her needs and her attempts to satisfy the needs. This theory represents the use of media in terms of gratification of social or psychological need of the individual. This theory shifted the approach of gratification from the functional paradigm to social sciences (Katz, Blumler and G urevitch, 1974).  Gratification can be derived from three distinct sources which are media content, exposure, and social content. The mass media compete with other sources of gratification, but gratifications can be obtained from a medium's content (e.g. watching a specific program), from familiarity with a genre within the medium (e.g. watching soap operas).