Why at-t stock price reacted positively

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Reference no: EM133007037

On December 11, 2007, AT&T Inc. announced that it would increase its dividend per share by 12.7%. At the same time the company announced a $15.2 billion stock buyback plan. The stock price of AT&T closed up 4.1% on that day.

Problem 1: Explain why AT&T's stock price reacted positively to those announcements.

Problem 2: Speculate as to why the stock price of AT&T rose only 4.1% while its dividends per share increased 12.7%

Reference no: EM133007037

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