Which of the Following Statements Is CORRECT

question 45

Multiple Choice

Which of the following statements is CORRECT?

• A) If a firm repurchases some of its stock in the open market,then shareholders who sell their stock for more than they paid for it will be subject to capital gains taxes.
• B) An open-market dividend reinvestment plan will be most attractive to companies that need new equity and would otherwise have to issue additional shares of common stock through investment bankers.
• C) Stock repurchases tend to reduce financial leverage.
• D) If a company declares a 2-for-1 stock split,its stock price should roughly double.
• E) One advantage of adopting the residual dividend model is that this makes it easier for corporations to meet the requirements of Modigliani and Miller's dividend clientele theory.

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Definitions:

Body Temperatures

Refers to the measure of the body's ability to generate and get rid of heat, crucial for maintaining homeostasis.

Morning People

Individuals who feel more energetic and are more productive in the morning as compared to other times of the day.

Evening People

Individuals who have a natural preference for staying up late and may find it more difficult to wake up early in the morning, often referred to as "night owls."

Morning Person

An individual who feels more alert and productive in the early part of the day compared to other times.