1. What is the difference between a stock dividend and a stock split? As a stockholder, would you prefer to see your company declare a 100% stock dividend or a 2-for-1 split? Explain. Assume that either action is feasible.
2. Discuss this statement, "Firms can control their accruals within fairly wide limits."
3. Calculate the variance of an investment with five year returns of 10%, 6%, 4%, 2% and (10%).