Which one of the following statements is true?

The IRS code discourages the accumulation of surplus cash thereby encouraging dividends.

Dividend payout policies are always set according to the best interest of the shareholders.

Acquisitions are generally believed to be an excellent alternative to dividends.

Managers tend to benefit more from decreasing a firm's size rather than increasing its size.

Current tax laws favors dividends over repurchases from the stockholders' point of view