Explain under which conditions an increase in the dividend payment can be interpreted as a signal of: a. Good news b. Bad news. a. Good news. Under which conditions can an increase in the dividend payment be interpreted as a signal of good news: (Select the best choice below.) O A. Raising dividends gives investors more cash, so the stock price increases, which is good news. O B. By increasing dividends managers signal that they have cash to pay out, which is good news. C. By increasing dividends managers signal higher future growth prospects, which is good news. 0 D. By increasing dividends managers signal that they believe that future earnings will be high enough to maintain the new dividend payment. b. Bad news Under which conditions can an increase in the dividend payment be interpreted as a signal of bad news: (Select the best choice below.) O A. Raising dividends for no reason signals management's desire to manipulate investors, which is a waste of managerial resources, which is bad news. B. Raising dividends signals that the firm does not have any positive NPV investment opportunities, which is bad news. C. Raising dividends requires borrowing money and increasing debt, which is bad news. D. Raising dividends means paying out more cash, leaving less cash in the firm, and thus reducing value, which is bad news