Why Are Dividend Changes Rather Than Their Absolute Level Perceived

question 1

Multiple Choice

Why are dividend changes rather than their absolute level perceived to be more important to managers and shareholders?

• A)Managers only change dividends under threatening conditions
• B)Dividend changes are thought to signal future expectations
• C)MM states that the absolute level of dividends is irrelevant
• D)Changes determine whether borrowing must occur

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Definitions:

Discriminatory Pricing

The practice of charging different prices for the same product or service to different consumers, especially in a manner considered unfair or unethical.

Corporate Espionage

The practice of secretly gathering proprietary or confidential information from competitors or other businesses for competitive advantage.

Sustained Price Cuts

A strategic reduction in the prices of goods or services, maintained over a long period, to attract more customers or gain a competitive advantage.

Anticompetitive Strategies

Practices implemented by businesses to reduce competition, potentially leading to monopolies or unfair market advantages.