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Kelso's Is Considering Spending $80,000 on Either a Stock Repurchase

Question 43

Multiple Choice

Kelso's is considering spending $80,000 on either a stock repurchase or an extra cash dividend.Which one of the following values will be the same whether the firm pays a dividend or repurchases stock? Assume there are no taxes or market imperfections.


A) Number of shares outstanding
B) Price per share
C) Earnings per share
D) Price-earnings (PE) ratio
E) Market value of equity per share

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