Share Repurchases Have a Tax Advantage Over Dividends Because ________

question 109

Multiple Choice

Share repurchases have a tax advantage over dividends because ________.

• A) dividend payments are tax deductible
• B) share repurchases increase the value of debt
• C) capital gains can be deferred by long-term investors
• D) repurchases are associated with increased customer loyalty

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Definitions:

Capacity

The maximum level of output that a company can sustain to make a product or provide a service under normal conditions.