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Author Question: Assume that the tax on dividends and the tax on capital gains is the same. All else equal, what ... (Read 35 times)

ereecah

  • Hero Member
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  • Posts: 530
on: Jul 10, 2018
Assume that the tax on dividends and the tax on capital gains is the same. All else equal, what
  would a prudent investor prefer?
 
  A) The prudent investor would prefer dividendsNa dollar today is always worth more than a
  dollar to be received in the future.
  B) The prudent investor would prefer capital gainsNthe capital gain tax liability can be deferred
  until gains are realized.
  C) The prudent investor would be indifferent between receiving dividends or capital gains.
  D) More information is needed.

Question 2

Zero balance accounts permit centralized control over cash outflows while maintaining divisional
  disbursing authority.
 
  Indicate whether the statement is true or false
Foundations of Finance ¦ Keown, Petty, Martin ¦ 9th Edition
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lgoldst9

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  • Posts: 372
Reply #1 on: Jul 10, 2018
Answer to Question 1

B

Answer to Question 2

TRUE


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