All Else Equal,the Market Value of a Stock Will Tend

question 40

Multiple Choice

All else equal,the market value of a stock will tend to decrease by roughly the amount of the dividend on the:

• A) dividend declaration date.
• B) ex-dividend date.
• C) date of record.
• D) date of payment.
• E) day after the date of payment.

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Definitions:

Common Stockholders' Equity

Common stockholders' equity represents the ownership interest held by common shareholders in a company, including assets minus liabilities and preferred stock equity.

Market Value

The ongoing rate at which an asset or service can be traded or acquired in the market.

Stock Dividend

A dividend payment made in the form of additional shares rather than cash.

Stock Split

A corporate action where a company divides its existing shares into multiple shares to boost the liquidity of the shares.