ignoring posstble tax effects and signaling costs, the total value of a firm's equity remains...
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ignoring posstble tax effects and signaling costs, the total value of a firm's equity remains the same irrespedtive of how the frm distributes Its residual earnings-dividends or stock repurchases. Each distribution method has certain advaritages and disadvantages Based on your understanding of dividends and stock repurthases, select the best terms to go with the statements Select the best term to complete the sentence Undervalued Overvalued Management is likely torepurchase stock if it believes that the stock is 7??2, this sends positive signals to investors False True Repurchases allow a firm to buy back as much stock as it wants, at whatever price it wants, without affecting shareholders. This statement is 222? Avoid Encourage Management tries bo maintain consistent, regular dividend distributions to ?2?7 any dividend cuts in the future and prevent a negative signaling effect Saves Increases Repurchase transactions allow a firm to buy back stock that may be needed to fulfill obligations when employees exerdse their stock options. This 22?2 the costs associated with issuing new shares
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