According to the Expectations Theory,the Actual Dividend Must Equal the Expected

question 4

True/False

According to the expectations theory,the actual dividend must equal the expected dividend,or lese the stock price will decrease after the dividend amount is announced.

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Definitions:

Depreciates

Describes a decrease in value over time, often used in reference to currency or physical assets.

Imports

Goods and services purchased from other countries and brought into a country.

Inflation

The speed at which the overall price level for goods and services increases, thereby diminishing buying power.

Floating Exchange Rates

A system in which currency values are allowed to fluctuate according to foreign exchange market mechanisms without direct intervention by the country’s government.