Both (A) and (R) are true
Both (A) and (R) are false
(A) is false, but (R) is true
(A) is true, but (R) is false
Answer is Wrong!
Answer is Right!
The correct answer is: C. (A) is false, but (R) is true.
Assertion (A) is false because there is no obligation for a company to pay dividends to its shareholders. A company can choose to reinvest its profits back into the business, which can lead to higher future earnings for shareholders.
Reason (R) is true because dividends are taxed as ordinary income, while capital gains are taxed at a lower rate. This means that shareholders pay more tax on dividends than they do on capital gains.
Here is a more detailed explanation of each option:
- Both (A) and (R) are true. This is not the correct answer because assertion (A) is false.
- Both (A) and (R) are false. This is not the correct answer because assertion (A) is false and reason (R) is true.
- (A) is false, but (R) is true. This is the correct answer because assertion (A) is false and reason (R) is true.
- (A) is true, but (R) is false. This is not the correct answer because assertion (A) is false.