Question
WATS has announced that the dividend for this year is $0.80 more than last year's. The share price yet dropped immediately after the announcement. Which
WATS has announced that the dividend for this year is $0.80 more than last year's. The share price yet dropped immediately after the announcement. Which of the following is the most correct if the market is efficient?
a. Before the announcement, the investors expected the dividend would drop.
b. Before the announcement, the investors expected the dividend would increase by less than $0.80.
c. Before the announcement, the investors expected the dividend would increase by more than $0.80.
d. The share price will increase later to restore fair value.
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