Suppose That There Are No Taxes, Transactions Costs, or Other

question 60

Multiple Choice

Suppose that there are no taxes, transactions costs, or other market imperfections. Which of the following actions is most likely to make shareholders better off?

• A)Increase dividends.
• B)Reduce share repurchases.
• C)Announce that dividends will not change for at least three years.
• D)Eliminate negative-NPV projects.

---

Definitions:

Directly

In a straightforward or straight line manner; without intervening factors or intermediaries.

Marketing Channel

Pathways and processes through which goods and services flow from producers to consumers.

Intermediaries

Entities or individuals that act as middlemen between the producer and the consumer in the distribution process, facilitating transactions and logistics.

Manufacturers

Companies or individuals that produce goods for sale using raw materials and components through various processes.