One Argument Advanced in Favor of Reducing the Tax on Dividends

Multiple Choice

One argument advanced in favor of reducing the tax on dividends is that

A) dividends increase the wealth of shareholder's which contribute to increases in GDP.
B) reducing the tax on dividends will improve economic efficiency.
C) dividends accrue mostly to middle-income and low-income investors who are already paying heavy income taxes.
D) the reduction will encourage corporations to plow back retained earning into capital investments.