An Increase in Share Price Following an Increase in Dividends

question 23

Multiple Choice

An increase in share price following an increase in dividends is logical if the:

• A) firm borrows to obtain cash for the dividend.
• B) increased dividend signals higher future earnings.
• C) dividend is believed to be temporary.
• D) clientele effect is not important.

---

Definitions:

Obsessive-Compulsive Disorder

A mental disorder characterized by recurrent, unwanted thoughts (obsessions) and/or repetitive behaviors (compulsions) that one feels compelled to perform.

Arranging And Rearranging

A cognitive process involving organizing or reorganizing information or objects to solve problems or create new perspectives.

Anxiety And Anxiety-Related Disorders

These are mental health conditions characterized by significant fear, nervousness, and worry, often accompanied by physical symptoms like heart palpitations and sweating.

Obsessive-Compulsive Disorder

A mental health disorder characterized by persistent unwanted thoughts (obsessions) and repetitive behaviors (compulsions).