Current tax laws:

A) Do very little to encourage investment by treating all income equally .
B) T ax ordinary income, dividends, and long-term capital gains favorably.
C) Tax all capital gains regardless of the holding period favorably.
D) ​Encourage investment by taxing both dividends and long-term gains at lower rates.

Long-Term Capital Gains

Profits from the sale of an asset held for more than a specified period, typically taxed at a lower rate than short-term gains.

Dividends

Payments made by a corporation to its shareholder members, typically from profits or reserves.

Ordinary Income

Income earned from conducting standard business operations, as opposed to capital gains or investment income.