Managers Avoid Cutting Dividends Even in Response to Short-Term Fluctuations

question 33

True/False

Managers avoid cutting dividends even in response to short-term fluctuations in earnings.

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Definitions:

Annual Coupon

The interest payment made by a bond issuer to the bondholders, usually annually.

Yield To Maturity (YTM)

The rate of interest earned on a bond if it is held to maturity.

Premium

Premium in finance usually refers to the extra amount paid over the standard or nominal value, as in insurance premium payments or the additional amount to purchase securities.

Discount

A reduction applied to the nominal price of goods, services, or securities, often to incentivize purchase or investment.