Attempts Keep the Highest: 14 3. Dividends versus stock repurchases Ignoring possible tax effects and signaling costs, the total value of a firm's equity remains the same irrespective of how the fim distributes ts residual eanings-dividends or stock repurchases. Each distribution method has certain advantages and dsadvantages. Based on your understanding of dividends and stock repurchases, select the best terms to go with the statements Select the best term to complete the sentence Repurchase stock Distribute dividends Excess cash or a desire to recapitalize usually leads management to ?777 False True Repurchases are more dependable than dividends because the investor wealth does not decrease after a repurchase, whereas the stock price decreases when dividends are distributed. This statement is ???? Avoid Encourage Management tries to maintain consistent, regular dividend distributions to 7777 any dividend cuts in the future and prevent a negative signaling effect. Debt-to-equity Liquidity ratio Repurchases are also used to make significant adjustments to a fiem's 7777 ratio. O Type here to search