Argument in favor of low dividend policy

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Reference no: EM132030585

1. Which of the following is an argument in favor of a low dividend policy?

A. A preponderance of stockholders have minimal taxable income.

B. The tax on capital gains is deferred until the gain is realized.

C. Corporate tax rates exceed personal tax rates.

D. Few, if any, positive net present value projects are available to the firm.

E. A majority of stockholders have other investment opportunities that offer higher rewards with similar risk characteristics.

2. Which of the following is an argument in favor of a low dividend policy?

A. A preponderance of stockholders have minimal taxable income.

B. The tax on capital gains is deferred until the gain is realized.

C. Corporate tax rates exceed personal tax rates.

D. Few, if any, positive net present value projects are available to the firm.

E. A majority of stockholders have other investment opportunities that offer higher rewards with similar risk characteristics.

Reference no: EM132030585

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