CF

If you are the board director, and there is an excess of cash in the company, and there are no positive NPV investments, would you rather pay out dividend or buy back shares?
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Slide 1: Open question
BedrijfseconomieWOStudiejaar 3,4

This lesson contains 5 slides, with interactive quizzes.

time-iconLesson duration is: 55 min

Items in this lesson

If you are the board director, and there is an excess of cash in the company, and there are no positive NPV investments, would you rather pay out dividend or buy back shares?

Slide 1 - Open question

The theory says that there are four ways to buy back shares (open market, tender offer, auction and target offer). Which one is the most effective in your opinion and why?

Slide 2 - Open question

The effect of buy backs has some advantages, but also some disadvantages. Back in the 1980s buybacks were firstly legalized. Do you think legalization of repurchase of shares was a good idea, why (not)?

Slide 3 - Open question

Can share buybacks be seen as a signal of a company's confidence in its own future performance? How do investors typically interpret share buybacks in this context?

Slide 4 - Open question

To verify if all of you did pay attention: what is the size of the countries first group and the size of the control group?

Slide 5 - Open question