Which of the following statements concerning dividend policy is true? 1. Unexpected dividend increase announcements are usually perceived as...

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Finance

Which of the following statements concerning dividend policy istrue?
1.
Unexpected dividend increase announcements are usually perceivedas positive signals because they indicate an expected increase infuture earnings of the firm.
2.
A constant payout ratio policy enables stockholders toaccurately predict future dividends.
3.
Since there is no evidence that one investor group is betterthan another, firms should change dividend policies frequently withno adverse impact stock price.
4.
Firms with stable earnings, such as utilities, tend to have alow dividend payout ratio.

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Answer Statement 1 is true ieUnexpected dividend increase announcements are usually perceived as positive signals because they indicate an expected increase in future earnings of the firm Because increased dividend See Answer

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	1.	Unexpected dividend increase announcements are usually perceivedas positive signals because they indicate an expected increase infuture earnings of the firm.
	2.	A constant payout ratio policy enables stockholders toaccurately predict future dividends.
	3.	Since there is no evidence that one investor group is betterthan another, firms should change dividend policies frequently withno adverse impact stock price.
	4.	Firms with stable earnings, such as utilities, tend to have alow dividend payout ratio.