The Share Price Falls When a Dividend Is Paid Because

question 31

Multiple Choice

The share price falls when a dividend is paid because the reduction in cash decreases th?

• A) current account of the firm.
• B) liabilities of the firm.
• C) market value of assets.
• D) equity of the firm.

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Definitions:

Reaction

A process in which substances interact to form new compounds or to change their physical or chemical properties.

Boiling Point

The temperature at which a substance transitions from the liquid phase to the gas phase under standard atmospheric pressure.

Compounds

Substances formed by chemically bonding two or more elements together in definite proportions.

Compound

A material composed of at least two elements that are chemically united in a constant proportion.