Which of the following statements is not true? A) The lower the PE ratio, the lo

Question

Which of the following statements is not true?

A) The lower the PE ratio, the lower the expectation investors are said to have in the corporation's future financial performance as compared to other companies in the same industry..

B) Cash dividends are the most common form of dividends. _1_

C) Qualified dividends are taxed at a lower rate than ordinary dividends.

D) Bond prices are more affected by interest rate risk than common stock prices. E) Tax on capital gains is paid as the stock appreciates rather than when the stock is sold and the gain is realized.

Explanation / Answer

All statements are true except E

E) Tax on capital gains is paid as the stock appreciates rather than when the stock is sold and the gain is realized.

Capital gain tax is not paid at the time of price appreciation, but same is paid at the time of profit reliazation i'e at the time of sale.

Rest all statement are true.

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