Managers have been characterized as reluctant to increase dividends if:

Question

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Managers may be reluctant to increase dividends if they believe the increase cannot be sustained in the long run, as this could lead to disappointment among shareholders if the dividend is later reduced. Thus, choice C is the best option. While choices A and D may also be factors that influence dividend decisions, they are not necessarily the key reasons why managers may be reluctant to increase dividends. Choice B is not relevant to the question of dividend payouts.

Managers Have Been Characterized as Reluctant to Increase Dividends If