Which of the Following Is TRUE of a Dividend Payout

question 19

Multiple Choice

Which of the following is TRUE of a dividend payout?

• A)When a firm announces that it will increase its dividend,the share price usually decreases on that news.
• B)Dividend payments send a positive signal to investors in the marketplace that management believes that the stock is overvalued.
• C)When a stock begins to trade ex dividend the share price will fall.
• D)When a stock begins to trade ex dividend there is no impact on the share price if the market.is efficient

Acknowledge the historical and theoretical foundations of capitalism and socialism.

Recognize the impact of price mechanisms and discounts on consumer behavior in a free market.

Understand the principle of egalitarianism and its economic implications.

Understand the concepts of different market structures, including pure competition, monopolistic competition, oligopoly, and monopoly.

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Definitions:

Implicit Costs

Denotes the opportunity costs of utilizing resources owned by the firm for its operations, instead of allocating them elsewhere to earn a return.

Total Cost

The sum of all expenses incurred in the production of goods or services, including both fixed and variable costs.

Accounting Profit

The difference between total revenue and explicit costs of a business.

Economic Profit

The profit a company makes after deducting both explicit and implicit costs, reflecting the total opportunity costs of its resources.