If a Company Announces a Change in Its Dividend Policy

question 27

True/False

If a company announces a change in its dividend policy from a zero target payout ratio to a 100% payout policy, this action could be expected to increase the value of long-term options (say 5-year options) on the firm's stock.

---

Definitions:

Visceral Peritoneum

Layer of peritoneum covering the abdominal organs.

Enteric Nervous System

A subdivision of the autonomic nervous system that directly controls the gastrointestinal system.

Neurotransmitters

Neurotransmitters are chemical substances released by neurons to transmit signals to other neurons, muscle cells, or gland cells, playing a key role in the functioning of the nervous system.

Acetylcholine

A neurotransmitter in the nervous system that plays crucial roles in muscle activation and various brain functions.