Which of the following is not a reason a company would repurchase stock?
A)To reduce the number of outstanding shares.
B)To give the impression that the stock is worth buying.
C)To have shares of stock to issue when stock options are exercised.
D)To increase the total stockholders' equity balance and improve the ROE.

Question

Quizplus · Accepted Answer

A corporation may want to repurchase its stock from existing stockholders to (1)send a signal to investors that the company itself believes its own stock is worth acquiring,(2)obtain shares that can be reissued as payment for purchases of other companies,(3)obtain shares to reissue to employees as part of employee stock purchase plans,and (4)reduce the number of outstanding shares to increase per-share measures of earnings and stock value.

Which of the Following Is Not a Reason a Company