mcq

which of the following statements is correct. (Kaplan kit)

i am reproducing only 2 out of the 4

B. a share repurchase scheme can increase both the EPS and gearing

C. M&M argued that the financing decision is more important than the dividend decision.

the correct answer is B and i had chosen C

if shares r repurchased, this means the number of shares of the co will increase, meaning equity will go up. so that will surely reduce EPS and decrease gearing.

so y is B correct?

also, can u pls explain y C is not correct? because since dividends r irrelevant, that just leaves us with the finance decision of selecting projects with npv>0

thanks