A company is considering distributing its $150 in cash eithe…
A company is considering distributing its $150 in cash either in the form of a dividend or by buying back its stock. If it distributes the $150 as a dividend, the cash will go to the current shareholders. If the company buys back its stock, it will pay $15/share. Using the drop-down choices, fill-in the six blanks in the table below to show the effects of the two distributions. Issue dividends Buyback shares A a B b C c