Which of the Following Statements Is NOT CORRECT

question 26

Multiple Choice

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)After a 3-for-1 stock split, a company's price per share should fall, but the number of shares outstanding will rise.
• C)Investors can interpret a stock repurchase program as a signal that the firm's managers believe the stock is undervalued.
• D)Companies can repurchase shares to distribute large inflows of cash, say from the sale of a division, to stockholders without paying cash dividends.
• E)Stockholders pay no income tax on dividends if the dividends are used to purchase stock through a dividend reinvestment plan.

---

Definitions:

Hallucinations

Perceptions in a conscious and awake state in the absence of external stimuli that have qualities of real perception.

Stimuli

External factors or events that provoke a response from the sensory system or an organism.

Perceives

The process by which an individual becomes aware of or interprets sensory information.

Mood Disorders

A category of mental disorders involving persistent disturbances or fluctuations in mood that cause significant impairment in daily functioning.