Eastboro Machine Tools Corporation

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STATEMENT OF THE PROBLEM Although this case presents several different issues to consider, the underlying problem is the correct implementation of Eastboro's dividend policy. Eastboro was founded as a manufacturer of machine parts, and has traditionally paid a fairly substantial dividend. However, in recent years, the core focus of the company has shifted toward technology in the fields of computer-aided design and manufacturing, highlighted by its latest development, Artificial Workforce. This shift in the focus …

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