Need ASAP Finance Major

Describe the different mechanisms available to a firm for repurchasing shares.

There are threemechanisms: (Select the best choicebelow.)

A.1) In an open marketrepurchase, the firm repurchases the shares in the open market. This is the most common mechanism in the United States.

B. 2) In a tenderoffer, the firm announces the intention to all shareholders to repurchase a fixed number of shares for a fixedprice, conditional on shareholders agreeing to tender their shares. If not enough shares aretendered, the deal can be cancelled.

C. 2) In a tenderoffer, the firm announces the intention to repurchase a fixed number of shares for a fixedprice, conditional on shareholders agreeing to tender their shares. Even if not enough shares aretendered, the firm is obligated to repurchase the shares that are tendered.

D. 3) A targeted repurchase is similar to a tender offer except that it is not open to allshareholders; only specific shareholders can tender their shares in a targeted repurchase.