Multiple Choice
Which statement related to the signaling effect of dividends is true?
A) The signaling effect can explain why an increase in the dividend is often followed by an increase in stock price.
B) The signaling effect is a reason a firm may follow a constant or steadily increasing dividend policy.
C) Changes in dividends can be interpreted as a signal from management about changes in the company's future earnings.
D) All of the above
Correct Answer:
Verified
Correct Answer:
Verified
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