If corporate firms start offering higher dividends on their stock,the price of the exhaustible resource tends to fall in the current period.

Question

Quizplus · Accepted Answer

When a company increases its dividend, it signals to investors that it has excess cash and may not have as many profitable investment opportunities available. This may cause some investors to sell their shares, which can decrease the price of the stock. In turn, this can also decrease the price of the exhaustible resource that the company may be extracting or using in their operations.

If Corporate Firms Start Offering Higher Dividends on Their Stock,the