5. Which of the following statements is false regarding the corporate payout policy?
(A)Because long-term investors can defer the capital gains tax until they sell, there is a tax advantage for share repurchases over dividends.
(B) Managers are much Iess committed to dividend payments than to share repurchases.
(C) The dividend-capture theory states that in absence of transaction costs, investors can trade shares at the time of the dividend so that non-taxed investors receive the dividend.
(D)Differences in tax preferences create clientele effects, in which the dividend policy of a firm is optimized for the tax preference of its investor clientelc.
(E)While many investors have a tax preference for share repurchases rather than dividends, the strength of that preference depends on the difference between the dividend tax rate and the capital gain tax rate that they face.