Q3. Market-wide investor sentiment may affect the stock market reaction (measured by the cumulative abnormal returns (CAR) around

announcement) towards dividend-increasing announcements. How can I test the effect of sentiment on the market response (CAR)?

A. CAR = a + b*Sentiment + c*Increase + e

B. Sentiment = a + b*Sentiment*Increase + e

C. CAR = a + b*Sentiment + c*Increase + d*Sentiment*Increase +

e D. CAR = a + b*Increase + c*Sentiment*Decrease + e