Managers Are Reluctant to Make Dividend Changes That They May

question 18

True/False

Managers are reluctant to make dividend changes that they may have to reverse.

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Definitions:

Bargained-For-Exchange

A fundamental principle in contract law requiring that each party to a contract must exchange something of value for the agreement to be binding.

Legally Enforceable

Pertains to an agreement or contract that is recognized by law and can be upheld or imposed by a court.

Legal Detriment

In contract law, doing (or promising to do) something that one has a legal right not to do, giving up (or promising to give up) something that one has a legal right to keep, or refraining from doing (or promising not to do) something that one has a legal right to do.

Hamer v. Sidway

A landmark 1891 New York Court of Appeals case that established the principle of forbearance (refraining from an action) as valuable consideration in contract law.