spoo262005
06.05.2020 •
Business
Purple Sage Producers Inc. is an oil drilling company. The company paid a dividend of $1.75 last year, and, in the past, its dividend has increased steadily by about 4% a year. Purple Sage just announced that its dividend will increase to $2.50 this year, and its share price rose from $30 per share to $33 per share immediately after the announcement.
Which of the following best explains why Purple Sage's stock price increased as it did?
a.The signaling hypothesis
b.Dividend irrelevance theory
c.The clientele effect
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Ответ:
Option A is the correct one.
The signaling hypothesis
Explanation:
The idea that many actions taken by economic agents are motivated chiefly by the wish to send a positive 'signal' to other agents, rather than by their ostensible purpose. This can be a means of overcoming the problem of asymmetric information between transactors.
This strategy was implemented by the Purple Sage Producers Inc. and this resulted in increased stock price.
Ответ:
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