34. Why might a firm repurchase its own stock? A. It has a shortage of cash B. Its share price is too high C. Its EPS is too high D. It cannot compute its return on equity E. None of the above 35. Which of the following is (are) true about dividend changes? A. Dividend changes follow changes in the Federal Reserve's target rate B. Dividend changes follow shifts in long-run sustainable earnings C. Management are reluctant to increase dividends if they might need to be cut later D. Both B and C E. All of the above 36. In the Miller-Modigliani world of perfect capital markets A. Dividend changes are important B. Dividend changes are irrelevant C. Interest rate swaps are profitable D. Stock options are highly profitable E. None of the above 37. Wintergrin Corporation has $4 million in cash and 400,000 shares of stock outstanding. It announces a 10% stock dividend. What will its stockholders receive? A. $400,000 cash B. $4 million cash C. 40,000 more shares of stock D. Nothing E. All of the above. 38. What is the advantage for stockholders of share repurchases over dividends? A: Stockholders can defer receipt of cash dividends B. Stockholders can wait to sell their stock back to the company until it is advantageous C. Stockholders do not have to pay capital gains taxes on share repurchases D. Stockholders do not have to pay taxes on cash dividends E. All of the above. 39. Honjammer Inc. paid $14 million in dividends in 2016, during that year it had $42 million in earnings and 7 million shares outstanding. What is its dividends per share? A. $0.33 B. $0.17 C. $0.50 D. $2.00 40. What happened after the tax rate on dividends was cut in 2003? A. The Astros won the World Series B. The number of new dividend initiations by US firms increased significantly C. Many firms cut their dividends D. Dividend payouts remained constant E. None of the above