Substantial dividend or repurchase shares of stock

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Reference no: EM13935103

Residential Inc. produced substantial profits in the previous year. Assume that Residential pays 35% corporate income tax. If investors are taxed at 25% on ordinary income, and have 0% capital gains tax, would Residential’s common stock investors prefer that the company pay a substantial dividend or repurchase shares of stock?

Reference no: EM13935103

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