Given below are five statements. You must answer all five. Some are True/False/Partially True and some require an analysis. Please answer the question and explain your answer since it is the argument that matters; but, be succinct.

a. When a firm decides to pay out excess cash to shareholders, they should always do it via a share repurchase since it is tax advantaged over special dividends. Please answer True/False/PartiallyTrue and Explain why

b. A firm has a new CEO hired away from another firm in another country where shareholders have been designated with more rights and powers based on the laws in that country. The CEO expects to pay higher dividends with the new firm since the weaker shareholders must now be given more dividends to qualm their concerns. Please answer True/False/PartiallyTrue and Explain why

c. There is a tax plan proposal where the major component is a substantial decrease in the corporate tax rate. If this were to be the only significant change in the tax code and no other forces we discussed in class (agency and information for instance) were relevant, what changes would you expect to see in corporate leverage in the country? That is, would this tax code change lead to more or less debt in firm capital structure?

d. When a firm repurchases shares, their stock price tends to increase. The sole reason for this is that there are now fewer shares outstanding that the value is allocated to. Please answer True/False/PartiallyTrue and Explain why

e. You are always better off going after a publicly traded firm as opposed to a privately held firm since the small number of owners in the latter case will be more powerful and able to extract a higher premium in the acquisition. Please answer True/False/PartiallyTrue and Explain why