When a Company Acquires Treasury Stock, What Effect Does This

question 19

Multiple Choice

When a company acquires treasury stock, what effect does this transaction have on earnings per share and legal capital, respectively?

• A) decrease, increase
• B) increase, decrease
• C) decrease, decrease
• D) increase, none

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Definitions:

Achievement Motivation

The drive to pursue and meet (often challenging) goals, based on the desire to achieve success and excel.

Intermediate Difficulty

A level of challenge that is neither too hard nor too easy, often considered optimal for learning and engagement.

Immediate Gratification

The desire to experience pleasure or fulfillment without delay or deferment, often prioritizing short-term rewards over long-term goals.

Affective Forecasting

The process of predicting how one will feel in the future, often with a focus on emotional reactions to specific events.