Which Three of the Following Correctly Apply to a Share

question 25

Multiple Choice

Which three of the following correctly apply to a share buy- back?

• A) It can be used so that the company can raise the level of borrowings on its balance sheet.
• B) It is a way of reducing the tax burden while maintaining total dividend payments.
• C) It can be used when the company is unsure about the sustainability of a possible increase in the normal cash dividend.
• D) It is a way to return money, held within the company, to the owners.

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Definitions:

Present

The current moment or period in time, as opposed to the past or future.

Near Future

A term referring to the time period that is just ahead, often used in the context of anticipated events or trends.

Participatives

A leadership or organizational style that emphasizes involvement and participation of all members in decision-making processes.

Roots

The part of a plant that attaches it to the ground or to a support, typically underground, conveying water and nourishment to the rest of the plant.