Which of the following statements is most correct?
A) If a firm repurchases its stock in the open market, the shareholders that tender are subject to capital gains taxes.
B) If you own 100 shares in a company's stock, and the company does a 2- for-1 stock split, you will own 200 shares in the company following the split.
C) Some dividend reinvestment plans increase the amount of equity capital available to the firm.
D) All of the statements above are correct.
E) Answers a and b are correct.

Question

Quizplus · Accepted Answer

All the statements are correct: A) Shareholders who tender their shares in a repurchase may face capital gains taxes. B) A 2-for-1 stock split doubles the number of shares owned. C) Dividend reinvestment plans can increase a firm's equity capital.

Which of the Following Statements Is Most Correct