Use the Information for the Question(s)below

question 24

Essay

Use the information for the question(s)below.
Iota Industries is an all-equity firm with 50 million shares outstanding. Iota has $200 million in cash and expects future free cash flows of $75 million per year. Management plans to use the cash to expand the firm's operations, which in turn will increase future free cash flows by 12%. Iota's cost of capital is 10% and assumes that capital markets are perfect.
-What other (non-tax)factors should be considered when analysing shareholders' preferences to dividends over share repurchases?
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Definitions:

Fixing Belief

The process of establishing or settling on a particular belief or understanding based on reasoning, evidence, or persuasion.

Dichotomous Conclusions

Outcomes of analysis that divide data or results into two distinct categories or opposite parts.

Critical Theory

A philosophical approach to culture, literature, and art that seeks to confront the social, historical, and ideological forces and structures that produce and constrain it.

A Priori Method

A method of reasoning based on theoretical deduction rather than empirical evidence.