True or False An investor who pays no tax would be more likely to...

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True or False

An investor who pays no tax would be more likely to accept the view that high dividends increase stock values rather than the view that low dividends increase stock values. 1) True 2) False Question 3 (1 point) Other things equal, individuals in high-income tax brackets should have a preference for firms that retain their earnings rather than pay dividends. 1) True 2) False Question 4 (1 point) The residual dividend theory is based on the observation that flotation costs make the cost of new common stock significantly higher than the cost of retained earnings

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