Which of the following statements regarding stock dividends and stock splits is true:

1) a three-for-two stock split is equivalent to

2) a 100% stock dividend. a two-for-one stock split is equivalent to a 50% stock dividend.

3) a 50% stock dividend is equivalent to a three-for-two stock split.

An assumption of the MM dividend irrelevance proposition is:

1) extra cash dividends are offset by a capital gain.

2) investors are willing to pay higher prices for shares with higher payouts.

extra cash dividends are offset by a capital loss.

3) capital gains are offset by receiving no dividend.

4) a three-for-one stock split is equivalent to a 66% stock dividend.