Home / Questions / Suppose Barston must pay corporate taxes at a 35 rate on the interest it will earn from th...
Suppose Barston must pay corporate taxes at a 35% rate on the interest it will earn from the one-year Treasury bill paying 6% interest. Would pension fund investors (who do not pay taxes on their investment income) prefer that Barston use its excess cash to pay the $100,000 dividend
immediately or retain the cash for one year?
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