When a Corporation Makes a Profit,it Must Pay Taxes on That

question 7

True/False

When a corporation makes a profit,it must pay taxes on that amount. Then,when those profits are distributed to shareholders,each shareholder must again pay taxes on his or her individual amount. This process is called double taxation.

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Definitions:

Duration

A measure of the sensitivity of the price of a bond or other debt instrument to a change in interest rates, usually expressed in years.

Perpetuity

A financial term for a constant stream of identical cash flows with no end.

Yield

The earnings from an investment, like dividends or interest, shown as a percentage of the investment's original cost or its current market valuation.

Perpetuity

A type of financial instrument that provides an infinite stream of interest payments.