Natsam Corporation has $264 million of excess cash. The firm has no debt and 472 million shares outstanding with a current market price of $11 per share. Natsam's board has decided to pay out this cash as a one-time dividend.

a. What is the ex-dividend price of a share in a perfect capital market?

b. If the board instead decided to use the cash to do a one-time share repurchase, in a perfect capital market, what is the price of the shares once the repurchase is complete?

c. In a perfect capital market, which policy in part (a) or (b) makes investors in the firm better off?

A. answer for part a = $11.56; answer for part b = $11; answer for part c = policy in part (a) is better

B. answer for part a = $11; answer for part b = $11; answer for part c = investors are indifferent between parts (a) and (b)

C. answer for part a = $10.44; answer for part b = $11; answer for part c = investors are indifferent between parts (a) and (b)

D. answer for part a = $10.44; answer for part b = $10.44; answer for part c = policy in part (b) is better