A Firm Increases Its Dividend Plowback Ratio

question 16

Multiple Choice

A firm increases its dividend plowback ratio. All else equal you know that ________.

• A)earnings growth will increase and the share's P/E will increase
• B)earnings growth will decrease and the share's P/E will increase
• C)earnings growth will increase and the share's P/E will decrease
• D)earnings growth will increase and the share's P/E may or may not increase

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Definitions:

Stimulus Generalization

The tendency to respond to a stimulus that is only similar to the original conditioned stimulus with the conditioned response.

Stimulus Adaptation

The decrease in responsiveness of sensory receptors to a constant stimulus over time, leading to a diminished perception of the stimulus.

Response Generalization

The process by which a response applied to one stimulus becomes associated or elicited by other, similar stimuli.

Neurofeedback

Form of biofeedback using brain-scanning devices to provide feedback about brain activity in an effort to modify behavior.