What happens to a public company's stock price right after it pays out its quarterly cash dividend? Its stock price Decreases by the amount of the quarterly dividend. Increases by the amount of the cash dividend. does not change. Question 2 Firm A pays dividends and has grown its dividend payments at a 5% annual rate. Firm B does not pay dividends and has indicated it does not plan to pay any in the foreseeable future. Therefore We can use the dividend discount model to get a stock price for firm A and B. We can use the dividend discount model to get a stock price for firm A. The stock price of firm A is bigger than the stock price of firm B. We can use the dividend discount model to get a stock price for firm B