In response to a temporary decline in earnings per share,most companies would

Question

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Most companies would not decrease their cash dividend in response to a temporary decline in earnings per share because it could cause a negative reaction from investors and potentially harm the company's stock price. It is better to maintain the dividend or even increase it if possible to demonstrate the company's stability and commitment to shareholders. Suspending or substituting the dividend could also send negative signals to the market.

In Response to a Temporary Decline in Earnings Per Share,most