Which of the Following Statements Is FALSE

question 39

Multiple Choice

Which of the following statements is FALSE?

• A)Unlike with capital structure,taxes are not an important market imperfection that influence a firm's decision to pay dividends or repurchase shares.
• B)If dividends are taxed at a higher rate than capital gains,which has been true until the most recent change to the tax code,shareholders will prefer share repurchases to dividends.
• C)Shareholders typically must pay taxes on the dividends they receive.They must also pay capital gains taxes when they sell their shares.
• D)Because long-term investors can defer the capital gains tax until they sell,there is still a tax advantage for share repurchases over dividends.

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Definitions:

Marketing Strategy

A company's plan for promoting and selling its products or services, including market research, advertising, and sales tactics.

Long Term

The long term refers to an extended period of time, often relating to strategic planning, investments, and outcomes that are expected to unfold or mature over several years.

Aggressive Direct Selling

A highly assertive sales strategy where products or services are sold directly to consumers in a manner that energetically pushes for immediate sales.