QUESTION

3) Which of the following statements is NOT CORRECT? A) Stock repurchases can be used by a firm as part of a plan to ch

Category: Business
Subject: Finance
Due Date: 01/27/2016
Question Asked: 2016-01-27 18:15:23

$1.00

Asked by:

User: LightspeedLearning
Rating: No Rating (0)
Earnings: $1.10
Questions: 369
Tutorials: 369
Send me a message

3) Which of the following statements is NOT CORRECT?

A) Stock repurchases can be used by a firm as part of a plan to change its capital structure.

B) A company can repurchase stock to distribute a large one-time cash inflow, say from the

sale of a division, to stockholders without having to increase its regular dividend.

C) Stockholders pay no income tax on dividends if the dividends are used to purchase stock

through a dividend reinvestment plan.

D) After a 3-for-1 stock split, a company's price per share should fall, but the number of

shares outstanding will rise.

E) Investors may interpret a stock repurchase program as a signal that the firm's managers

believe the stock is undervalued, or, alternatively, as a signal that the firm does not have many

good investment opportunities.

AVAILABLE ANSWERS

Join Us
Or

Purchase with additional $0.50
as a Guest

$ 1.00

3) Which of the following statements is NOT CORRECT? A) Stock repurchases can be used by a firm as part of a plan to ch

This answer hasn't been purchased yet.
Posted on 2016-01-27 18:15:23

Posted by:

User: LightspeedLearning
Rating: No Rating (0)
earnings: $1.10
Questions: 369
Tutorials: 369
Send me a message

Preview:

...the dividends are used to purchase stock through a dividend reinvestment plan.D) After a 3-for-1 stock split, a company's price per share should fall, but th...

The full tutorial is about 138 words long.