The Effect of Cash Dividends on Stock Prices


The purpose of this study is to measure how much the stock
prices decline ofter ex-dividend date in Tehran Stock Exchange.
Another parpose of the study is to investigate whether the
marginal tax rates of stock holders have any effect on the dividend
policy of the companies listed in Tehran Stock Exchange.
The results showed that the decline in stock price was less than
the amount of dividend per share. The results also showed that
tax rates of stockholders have no effect on amount of dividends
declared by the companies.