All else equal, what would you expect to happen to the cost of equity capital for firms
if the Bush dividend tax cut of 2003 is reversed? (That is, if dividends are once again
taxed at the marginal tax rate of investors.)How might this affect the optimal capital
structure of firms, if at all? Explain.

Question

Quizplus · Accepted Answer

The Answer of All else equal, what would you expect to happen to the cost of equity capital for firms
if the Bush dividend tax cut of 2003 is reversed? (That is, if dividends are once again
taxed at the marginal tax rate of investors.)How might this affect the optimal capital
structure of firms, if at all? Explain.

All Else Equal, What Would You Expect to Happen to the Cost