Which of the Following Statements Is INCORRECT

question 51

Multiple Choice

Which of the following statements is INCORRECT?

• 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) Stockholders pay no income tax on dividends if the dividends are used to purchase stock through a dividend reinvestment plan.

---

Definitions:

Release from Liability

A legal document that absolves one party from responsibility for any injuries or damages suffered by another party.

Organizational Announcements

Official messages distributed to members within an organization, often related to policy changes, new hires, promotions, or other significant updates.

Negative

Referring to something harmful, undesirable, or expressing disapproval or pessimism.

Performance Problems

Issues related to an employee's work performance that do not meet the established standards or expectations.