The correct answer is : False.
The answer would be true if one assumed that the finances of an organisation were managed in order to achieve the financial objectives of the organisation.
If this were the case, if the earnings per share (EPS) has fallen then the profits available for distribution to shareholders will fall and so will the level of dividends (assuming that there are no new issues of shares during the year).
It is not always the case in practice however that dividends follow the pattern of earnings. It is possible that dividends are increased in a period of reduced profitability, in order to support the share price.
