2. Dividendpolicy A firm's value depends on its expected free cash now and its cost of capital. Distributions made in the form of dividends or stock repurchases impact the firm's value and the investors in different ways, Consider the scenario, and answer the questions that follow: Mainway Oil Company is an oil drilling company and has some free cash now that is not expected to be used for growth or investment projects. The company plans to distribute to its shareholders but is still deciding whether they should conduct a stock repurchase or distribute dividends. Which of the following is a characteristic of a firm's optimal dividend policy It maximizes the firm's stock price. It maximizes the firm's return on equity. It maximizes the firm's earnings per share. It maximizes the firm's total assets