What is the most likely prediction after a firm reduces its regular dividend payment?
A)earnings are expected to decline.
B)investment is expected to increase.
C)retained earnings are expected to decrease.
D)share price is expected to increase.

Question

Quizplus · Accepted Answer

When a firm reduces its regular dividend payment, it often signals to the market that the firm expects lower earnings in the future. Investors typically view a dividend cut as a negative signal about a company's financial health and future prospects.

What Is the Most Likely Prediction After a Firm Reduces