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

Recognize the principles of efficient market hypothesis (EMH) and its different forms (weak, semi-strong, strong).

Comprehend the relationship between risk and expected returns, as well as the impact of efficiency on returns.

Understand the implications of market efficiency on investment strategies, including the ineffectiveness of technical analysis in efficient markets.

Grasp the role of information dissemination and competition in ensuring market efficiency.

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Definitions:

Southern Elites

The affluent and influential members of society in the southern regions, often historically associated with agricultural wealth and political power.

Southern Blacks

Refers to African American populations living in the Southern United States, historically subjected to segregation and significant civil rights struggles.

Radical Republicans

A faction within the U.S. Republican Party during the Civil War and Reconstruction eras, advocating for the abolition of slavery and aggressive measures to ensure civil rights for freed slaves.

Democrats

A major political party in the United States, historically associated with progressive policies and a broader social safety net.