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5. Singh and Ho discuss the impact of dividends, share repurchases, and leverage on a firm's free cash flow. Ho tells Singh the following: Statement

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5. Singh and Ho discuss the impact of dividends, share repurchases, and leverage on a firm's free cash flow. Ho tells Singh the following: Statement 1: Changes in leverage do not impact free cash flow to equity. Statement 2: Transactions between the company and its shareholders, such as the payment of dividends or share repurchases, do not affect free cash flow to equity. Which of Ho's statements regarding free cash flow is (are) correct? A. Statement 1 only B. Statement 2 only C. Neither Statement 1 nor Statement 2

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