The greater a firm's dividend payout, the [blank] likely it is that the stock's price will rise above the exercise price.

Question

Quizplus · Accepted Answer

The greater a firm's dividend payout, the less likely it is that the stock's price will rise above the exercise price because the company is using more of its profits to pay out dividends rather than reinvesting back into the business to drive growth and increase stock value. Therefore, there may be less potential for the stock price to increase in the future.

The Greater a Firm's Dividend Payout, the [Blank] Likely It