The combination of the corporate tax deductibility of interest payments and the personal taxes on dividends (and share repurchases) implies that:
A) individual investors with sufficiently high personal tax rates prefer financing new investment with debt.
B) taxable shareholders are indifferent to financing new projects with debt and equity.
C) taxable shareholders prefer debt financing over equity financing for funding new projects.
D) debt financing is favour by tax systems over equity financing.
Correct Answer:
Verified
Q2: Managers prefer funding investment first with retained
Q4: Dividend yield is the ratio of the:
A)dividend
Q5: Investors prefer retained earnings over a
Q6: In the presence of taxes,which of the
Q7: Dividend payout ratio is the ratio of
Q8: Which of the following is true of
Q9: Consider the choice between paying out earnings
Q10: Which of the following is an assumption
Q10: Which of the following is an assumption
Q11: Under imputation systems:
A)dividends are tax-free and capital
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