Which of the following is NOT a consequence of the double tax on dividends? Question 15 options: Corporations have an incentive to retain earnings and structure distributions to avoid dividend treatment. Corporations have an incentive to invest in non-corporate rather than corporate businesses. The cost of capital for corporate investment is increased. Corporations have an incentive to finance operations with debt rather than equity. All of the above are consequences of the double tax on dividends.

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Answered: Which of the following is NOT a…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Which of the following is NOT a consequence of the double tax on dividends?

Question 15 options:

	Corporations have an incentive to retain earnings and structure distributions to avoid dividend treatment.
	Corporations have an incentive to invest in non-corporate rather than corporate businesses.
	The cost of capital for corporate investment is increased.
	Corporations have an incentive to finance operations with debt rather than equity.
	All of the above are consequences of the double tax on dividends.

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