Which Statement Is Correct

question 86

Multiple Choice

Which statement is correct?

• A) Stock repurchases invalidate the dividend discount model
• B) Stock repurchases do not add value to a business and can be ignored.
• C) When there are repurchases, it is simpler to value a business by discounting the free cash flow.
• D) Stock repurchases increase the number of shares and make it difficult to forecast dividends per share

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Definitions:

NYSE Hybrid Market

A blend of electronic trading and traditional floor trading practices on the New York Stock Exchange, aiming to maximize the advantages of both.

NYSE Euronext

A global financial markets operator and provider, known for its operation of multi-asset exchanges across several countries.

Prospectus

A formal legal document that provides details about an investment offering to the public, often detailing the assets, risks, and objectives of the offering.

SEC

The Securities and Exchange Commission, a U.S. government agency responsible for enforcing federal securities laws and regulating the securities industry.