Question

Assume that the shareholders of a company anticipate receiving a normal dividend. What benefit would shareholders receive if the company instead repurchased shares with the same total amount of dollars that would have been spent on dividends? Assume that the PE ratio is maintained under either scenario.

Answer 1

Answer:

The correct answer for this scenario is “Shareholders can delay or reduce taxes”.

Explanation:

The investors of an organization envision getting a typical profit. Investors can postpone or decrease charges if the organization rather repurchased shares with a similar aggregate sum of dollars that would have been spent on profits