Which of the Following Statements Is FALSE

question 42

Multiple Choice

Which of the following statements is FALSE?

• A)Firms adjust dividends relatively infrequently,and dividends are much less volatile than earnings.This practice of maintaining relatively constant dividends is called dividend signaling.
• B)When a firm increases its dividend,it sends a positive signal to investors that management expects to be able to afford the higher dividend for the foreseeable future.
• C)The average size of the stock price reaction increases with the magnitude of the dividend change,and is larger for dividend cuts.
• D)When managers cut the dividend,it may signal that they have given up hope that earnings will rebound in the near term and need to reduce the dividend to save cash.

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Definitions:

DSM

The Diagnostic and Statistical Manual of Mental Disorders, a comprehensive classification of officially recognized psychiatric disorders, used by mental health professionals.

Dissociative Identity Disorder

A severe form of dissociation, a mental process that produces a lack of connection in a person's thoughts, memory, and sense of identity, formerly known as multiple personality disorder.

Personal Responsibility

The idea that individuals are accountable for their actions and decisions in their personal and professional lives.

Depression Factors

Various elements that contribute to the development of depression, including genetic, environmental, psychological, and biochemical factors.