1. What is the dividends received deduction? Why did Congress allow such a deduction? 2. From an economic policy perspective, do you think the provisions in Section 351 that allow non-taxable...

1. What is the dividends received deduction? Why did Congress allow such a deduction?

2. From an economic policy perspective, do you think the provisions in Section 351 that allow non-taxable corporate formation are desirable? Why or why not?

3. According to Miller’s (1977) paper, leverage does not increase firm value, even though interest expense on debt is tax deductible by corporations. Why?