Assume that as the result of a firm announcing a large unexpected increase in its dividend payment,the price of the firm's ordinary shares rises.This event would be consistent with which of the following?

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An unexpected increase in dividend payment may signal positive information about the firm's future prospects, such as higher profitability or cash flow, leading to an increase in the firm's share price. This is an example of the information signaling effect. The dividend irrelevance theory states that the firm's dividend policy does not affect its value, while the tax preference theory suggests that investors prefer dividends over capital gains due to tax considerations. The beta effect refers to the impact of changes in the overall market on a stock's price.

Assume That as the Result of a Firm Announcing a Large