Which of the Following Statements Is Correct

question 74

Multiple Choice

Which of the following statements is correct?

• A)Generally speaking, investors interpret a firm's decision to repurchase their own stock as a positive signal.
• B)A stock repurchase may be viewed as a sign that the firm doesn't have enough attractive capital budgeting projects.
• C)The IRS can impose penalties on a firm if tax authorities can show that the repurchase was performed primarily to avoid dividend taxation.
• D)All of these are correct.

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Definitions:

Socially Optimal Price

The price of a good or service that reflects the external costs and benefits to society, aiming to achieve the most efficient allocation of resources.

Big Data

Extremely large data sets that may be analyzed computationally to reveal patterns, trends, and associations, especially relating to human behavior and interactions.

Reservation Price

The maximum or minimum price at which a consumer is willing to buy or sell a good or service.

Elastic Demand

A situation where the demand for a product or service significantly changes in response to a change in price.