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Sir/Ma'am What is Contractual Constraints?

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Sir/Ma'am What is Contractual Constraints?

Posted by Afia Ali 4 years, 6 months ago

CBSE > Class 12 > Business Studies

1 answers

Mayank Garg 4 years, 5 months ago

These can be understood like some Conditions mentioned in a Contract. Linking it with Dividend Decision, Example- If a company raises loan from a bank, then the bank mention in contract that the company cannot distribute more than (say ₹2/share) dividend. This is the Contractual Constraint that the company has to see before Dividend Decision.

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