What are automatic dividend reinvestment plans designed to do?
A)aid shareholders in creating their preferred dividend policy
B)raise new equity capital for the firm through market repurchases
C)eliminate excess illiquid shares from the open market
D)help investors avoid paying taxes on dividends

Question

Quizplus · Accepted Answer

Automatic dividend reinvestment plans are designed to aid shareholders in creating their preferred dividend policy by automatically using dividends to purchase additional shares of the company's stock, thus reinvesting their earnings back into the company.

What Are Automatic Dividend Reinvestment Plans Designed to Do