Which of the Following Statements Is Correct

question 19

Multiple Choice

Which of the following statements is correct?

• A)If a company has a 2-for-1 stock split, its stock price should roughly double.
• B)Capital gains earned in a share repurchase are taxed less favourably than dividends; this explains why companies typically pay dividends and avoid share repurchases.
• C)Very often, a company's stock price will rise when it announces that it plans to commence a share repurchase program. Such an announcement could lead to a stock price decline, but this does not normally happen.
• D)The clientele effect is the best explanation for why companies tend to vary their dividend payments from quarter to quarter.

Comprehend the cash conversion cycle and its components.

Understand the impact of working capital on a firm’s financial policies.

Evaluate the significance of efficient working capital management.

Understand the sources of short-term financing and their costs.

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A section or tab in software applications like Microsoft Word that contains tools for proofreading, commenting, and tracking changes to documents.