Which of the Following Statements Is False

question 87

Multiple Choice

Which of the following statements is false?

• A) If firms smooth dividends, the firm's dividend choice will contain information regarding management's expectations of future earnings.
• B) Because of the increasing popularity of repurchases, firms cut dividends much more frequently than they increase them.
• C) Announcing a share repurchase today does not necessarily represent a long-term commitment to repurchase shares.
• D) While cutting the dividend is costly for managers in terms of their reputation and the reaction of investors, it is by no means as costly as failing to make debt payments.

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