The Following Statements Are True of Dividend Reinvestment Plans (DRIPs)

question 69

Multiple Choice

The following statements are true of dividend reinvestment plans (DRIPs) :
I.They are offered by the companies to their shareholders.
II.Generally, new shares are issued at a discount.
III.The dividends are taxable as ordinary income.

• A)I only
• B)I and III only
• C)I, II, and III
• D)III only

---

Definitions:

Restaurant Chain

A set of related restaurants in different locations that are either under shared corporate ownership or franchising agreements.

Domestic Investment

The total spending on capital goods within a country’s borders, which includes expenditures on new buildings, equipment, and technology.

Trade Deficit

An economic measure of a negative balance of trade where a country's imports exceed its exports.

Trade Surplus

A situation where the value of a country's exports exceeds the value of its imports, indicating a positive balance of trade.