When a Firm Begins to Pay Dividends, It Is Signalling

question 14

True/False

When a firm begins to pay dividends, it is signalling that it always expects to have enough cash flow to maintain and increase its dividend payout.

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Definitions:

Workforce Reduction

The act of decreasing the number of employees through methods such as layoffs, terminations, or voluntary retirement schemes to cut costs or improve efficiency.

Artificial Intelligence

The act of machines, notably computer systems, mimicking human intelligence activities such as learning, reasoning, and the capability for self-correction.

Technological Change

The process of innovation and the adoption of new or improved technology within an industry, business, or society.

Voluntary Sabbaticals

These are periods of leave, often unpaid, offered by employers to employees as a benefit, allowing them to take a break from their work for personal development, research, travel, or rest.