Which of the Following Statements About the Relative Advantages of Stock

question 77

Multiple Choice

Which of the following statements about the relative advantages of stock repurchases over dividends is NOT true?

• A) Stock repurchases send a stronger signal than dividends to the market about management's belief that the firm's prospects are good.
• B) Open-market stock purchases allow management more flexibility because investors are less likely to react if the management cuts back or ends a stock repurchase as compared to cutting back on dividend payments.
• C) Stock repurchases allow stockholders to choose whether or not to participate in the stock repurchase. This allows stockholders to have more control over their tax burden.
• D) Historically, taxes on dividend payment have been higher than those on stock repurchases.

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Definitions:

Reproductive Urges

The natural instinct or desire to reproduce and have offspring.

Gender Fluid

A person whose gender identity is not fixed and can change over time or depending on the situation.

Androgyny

The coexistence of both masculine and feminine personality traits in a single person.

Bisexualism

The romantic or sexual attraction towards both males and females.