Abstract

The article analyzes theoretically how a firm maximizes the value of shareholder’s wealth with its policy for dividend/reinvestment of the profit from operations, when taxes are considered. In the study, the net present value, i.e. the present value after deduction for taxes, is used as objective function. Four different taxes are considered. The analysis shows the terms on which it is profitable to receive dividend payout or to reinvest at an arbitrary time. Under the assumption of a unique maximum net present value, the terms at the time for the maximum net present value are also presented. The article can be applied in forest economy.

Keywords

Financing; Management

Published in

Skog & trä
2010, number: 2010:4
ISBN: 978-91-977896-5-3
Publisher: Enheten för skoglig fältforskning, Sveriges lantbruksuniversitet

SLU Authors

• Holm, Sören

  • Department of Forest Resource Management, Swedish University of Agricultural Sciences
    

• Jonsson, Bengt

  • Department of Forest Resource Management, Swedish University of Agricultural Sciences
    

UKÄ Subject classification

Economics


Permanent link to this page (URI)

https://res.slu.se/id/publ/126200