Question: Why has the effective capital gains tax rate tended to
Why has the effective capital gains tax rate tended to be substantially lower than the dividend tax rate in the United States? Given that this disparity exists, why do so many firms pay dividends?
Answer to relevant QuestionsSome goods and services are provided directly by the government, while others are funded publicly but provided privately. What is the difference between these two mechanisms of public financing? Why do you think the same ...Why are equity holders more likely than debt holders to want firms to engage in risky investments? Suppose that the corporate income tax rate is 30%, the personal income tax rate on dividend income and the interest tax rate are both 35%, and the capital gains tax rate is 20%. Compare the after-tax returns on each dollar ...Describe the advantages of using a value-added tax instead of a sales tax. Suppose that the world is populated by people who are identical in every dimension except for their savings behavior. People live for two periods, earning $500 in the first period and nothing in the second period. The income ...
Post your question