Which of the following statements is most correct?

Select one:

A. If X company issues a 2-for-1 stock split, the company'sstock price would be expected to approximately double.B. Capital gains earned in a share repurchase have historically beentaxed less favorably than dividends; this explains why companies typically pay dividends and avoid share repurchases.C. In general,a firm'sstock price will rise afterit announcesplans to begina share repurchase program. Althoughsuch an announcement could lead to a stock price decline,this does not normally happen.D. In general, stock repurchases tend to increase the number of outstanding shares.E. The best explanation available forwhy companies tend to vary their dividend paymentsquarter-to-quarter is known as the clientele effect