Question 7 (10 points) Listen When a company pays a stock dividend, which of the following is expected to happen? 1) decrease in equity paid-in surplus O2) increase in common stock outstanding 3) decrease in cash and cash equivalent 4) increase in the number of shareholders Question 8 (10 points) Listen When a corporation increases dividend, the information content generally signaled to the market is: 1) the corporation has more cash at hand due the decline in future sale growth O2) growth in future cash flows is expected to be higher and sustainable over the long-term 3) the corporation has cash surplus that need to be distributed to shareholders. 4) the corporation has excess cash due to fewer net present value projects