Which of the Following Signals Is Most Likely to Elicit

question 103

Multiple Choice

Which of the following signals is most likely to elicit a decrease in share price?

• A) A repurchase of 5% of the firm's stock
• B) An increase in the regular quarterly dividend
• C) A decrease in the regular quarterly dividend
• D) Borrowing funds in order to pay a cash dividend

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Definitions:

Stockholder

An individual or entity that owns shares in a corporation, thereby having a claim on part of its assets and earnings.

Indefinitely

For an unlimited or unspecified period of time, without a predetermined end point.

Accounting Process

A systematic series of steps involved in collecting, recording, summarizing, and presenting the financial transactions of a business.

Interpreting

The process of explaining or understanding the meaning of something, often related to data or information.