Expected return remained constant this announcement

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Reference no: EM131504901

As part of an unexpected news announcement, Alpha Co. stated that it is increasing its annual dividend from $1.04 per share to $1.10 per share. What else must the company have also announced if its stock price and total expected return remained constant following this announcement? Assume none of the announcement information was previously expected by the market.

a. The firm will continue to pays it dividend on an annual basis.

b. The firm is planning a new period of rapid growth.

c. The firm's ongoing operations are on track to meet prior expectations.

d. The firm's rate of growth will be less than previously anticipated.

e. The firm's dividend payout ratio has been, is, and will continue to be constant.

Reference no: EM131504901

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