Which of the Following Statements Is FALSE

question 42

Multiple Choice

Which of the following statements is FALSE?

• A)Firms adjust dividends relatively infrequently,and dividends are much less volatile than earnings.This practice of maintaining relatively constant dividends is called dividend signaling.
• B)When a firm increases its dividend,it sends a positive signal to investors that management expects to be able to afford the higher dividend for the foreseeable future.
• C)The average size of the stock price reaction increases with the magnitude of the dividend change,and is larger for dividend cuts.
• D)When managers cut the dividend,it may signal that they have given up hope that earnings will rebound in the near term and need to reduce the dividend to save cash.

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Definitions:

Adult Attachment Style

Patterns of expectation, needs, and behavior towards close relationships, formed in early childhood and continuing into adulthood.

Anxious-ambivalent

A type of attachment style characterized by intense emotional dependence and anxiety about rejection or abandonment.

Avoidance Coping Strategies

Avoidance coping strategies involve attempts to avoid stressors or the feelings of stress they provoke, rather than directly confronting the issue at hand.

Active Strategies

Deliberate efforts and techniques employed to address and manage problems, challenges, or tasks.