Lesson Plan

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Lesson Plan
Grade: Date: 17/01/2026
Subject: Business
Lesson Topic: the impact of changes in dividend strategy on ratio results
Learning Objective/s:
  • Describe how dividend policy influences the six key financial ratios (payout, retention, EPS, ROE, dividend yield, debt‑to‑equity).
  • Calculate these ratios for different dividend scenarios using provided financial data.
  • Analyse short‑term and long‑term implications of dividend changes for shareholders and the firm’s financing strategy.
  • Evaluate the strategic trade‑offs between rewarding shareholders now and retaining earnings for future growth.
Materials Needed:
  • Projector and screen
  • Whiteboard and markers
  • Printed worksheets with XYZ Ltd data tables
  • Calculators or spreadsheet software (Excel/Google Sheets)
  • Handout of ratio formulas and definitions
 Introduction:

Begin with a headline about a well‑known company increasing its dividend and ask students what they think will happen to its financial ratios. Review briefly the definitions of the six ratios covered last week. Explain that by the end of the lesson they will be able to predict and calculate how any dividend change reshapes these ratios.
Lesson Structure:
  1. Do‑now (5') – Quick quiz on ratio definitions and formula recall.
  2. Mini‑lecture (10') – Explain the link between dividend policy and each ratio; display formulas on the screen.
  3. Guided example (15') – Walk through Scenario A and Scenario B calculations for XYZ Ltd, highlighting the impact on each ratio.
  4. Pair activity (10') – Students use the worksheet to compute ratios for a new dividend scenario and record results.
  5. Class discussion (10') – Groups share findings; discuss stakeholder implications and strategic considerations.
  6. Check for understanding (5') – Exit ticket: write one sentence on how a higher dividend affects EPS and the retention ratio.
Conclusion:

Summarise how dividend adjustments ripple through profitability, liquidity and solvency ratios and why managers must balance shareholder expectations with internal financing needs. Collect exit tickets to gauge understanding, and assign homework: each student selects a real listed company, finds its latest dividend payout, and calculates the six ratios to comment on the firm’s strategic position.