Congress Allows Corporations to Exclude from Taxes 70 to 100

Multiple Choice

Congress allows corporations to exclude from taxes 70 to 100 percent of dividends received from other corporations. Congress did this to ________.

A) encourage corporations to invest in each other
B) avoid double taxation on dividends
C) eliminate most of the potential tax liability from the dividends received by the second and any subsequent corporations
D) lower the cost of equity financing for corporations