The following statements are true of dividend reinvestment plans (DRIPs):
I. 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 II only
C) I, II and III
D) III only

Question

Quizplus · Accepted Answer

Dividend reinvestment plans (DRIPs) are offered by companies to their shareholders, often allow new shares to be issued at a discount, and the dividends are taxable as ordinary income.

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