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Capital Gains Quiz

If both dividends and capital gains are taxed at the same ordinary income tax rate, the effect of tax is different because:

Which of the following investors have the strongest tax reason to prefer dividends to capital gains?

An alternative to paying cash dividends is to repurchase stock.

Because greenmail involves the repurchase of stock at a price higher than the market price, all shareholders benefit.

Firms have long-run target dividend payout ratios.