In case of an increase in dividend, which of the following will not be considere

Question

In case of an increase in dividend, which of the following will not be considered by the shareholders

Question options:

Higher dividend means better performance by the firm in the future, therefore the stock price should increase

Higher dividend means not many good projects, therefore the stock price should decrease

Higher dividend means lower cost of capital, therefore the stock price must go up.

Higher dividend means more money in the hand of the investors, means less agency cost, stock price must go up

Higher dividend means better performance by the firm in the future, therefore the stock price should increase

Higher dividend means not many good projects, therefore the stock price should decrease

Higher dividend means lower cost of capital, therefore the stock price must go up.

Higher dividend means more money in the hand of the investors, means less agency cost, stock price must go up

Explanation / Answer

Ans :- Higher dividend means more money in the hand of the investors, means less agency cost, stock price must go up

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