Corporations May Have a Legitimate Preference for Dividends Over Capital

question 39

Multiple Choice

Corporations may have a legitimate preference for dividends over capital gains because:

• A) capital gains have a 50% tax rate.
• B) dividends received by corporations are not taxable.
• C) 30% of dividends received by corporations are exempt from taxation.
• D) 70% of dividends received by corporations are exempt from taxation.