The Most Important Difference Between Stock Repurchases and Cash Dividends

question 46

Multiple Choice

The most important difference between stock repurchases and cash dividends is that they:
I. Benefit different groups
II. Have different effects on corporate cash flow
III. May have different tax consequences

• A) I only
• B) II only
• C) III only
• D) I, II, and III

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Definitions:

Significance Level

The probability of rejecting the null hypothesis when it is actually true, usually denoted as alpha (α).

Null Hypothesis

The assumption for a statistical test that there is no association between two observed phenomena or no difference among groups.

Population

In statistics, this term refers to the entire group of individuals or instances about which you are interested in making conclusions.

Statistics

The science of collecting, analyzing, interpreting, presenting, and organizing data.