Question: TRUE OR FALSE: 1) Shareholders may prefer dividends to a share repurchase program because repurchased shares are subject to taxation and increasing value per share

TRUE OR FALSE:

1) Shareholders may prefer dividends to a share repurchase program because repurchased shares are subject to taxation and increasing value per share due to dividends is tax deferred.

2) The guiding rule in deciding if a free cash flow is incremental is to look at the company only with the new project.

3) A firm's dividend policy includes two basic components: the dividend payout ratio and times interest earned.

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