A company is most apt to repurchase stock rather than pay out dividends when the firm:
A) wants to distribute excess cash by making a regular commitment to its investors.
B) wants to conserve current cash.
C) wants to avoid a commitment for future distributions.
D)foresees excess cash as a common long-term occurrence.

Question

Quizplus · Accepted Answer

Repurchasing stock allows a company to return cash to shareholders without committing to regular future payments, unlike dividends which suggest a recurring commitment.

A Company Is Most Apt to Repurchase Stock Rather Than