An Increase in Dividends Might Not Increase Price and May

question 84

Multiple Choice

An increase in dividends might not increase price and may actually decrease stock price if:

• A) the dividend increase cannot be sustained.
• B) the firm does not maintain an exact dividend payout ratio.
• C) the firm has too much retained earnings.
• D) markets are weak-form efficient.

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Definitions:

Optic Chiasma

A structure in the brain where the optic nerves (II) partially cross, involved in the visual system.

Visual Field

The entire area that can be seen when the eyes are directed forward, including what can be seen peripherally.

Optic Tracts

Nerve pathways traveling from the optic chiasma to the thalamus in the brain, important for the transmission of visual information.

Diencephalon

The diencephalon is a region of the brain that includes structures such as the thalamus and hypothalamus, involved in sensory and autonomic functions.