Stocks Beginner: Dividend Reinvestment Plans

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1.
When buying shares through a dividend reinvestment plan, you may actually receive newly issued shares.
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True. In some cases, the company issues brand-new shares.
2.
"Old stock," or stock that already exists, is issued to DRIP owners _______.
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At market price. No discount is applied.
3.
Dividend reinvestment plans benefit only employees of companies that have these plans.
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False. Dividend reinvestment plans benefit corporations and individuals who take advantage of them.
4.
A benefit of dividend reinvestment plans to corporations is that they are an inexpensive way to borrow money.
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False. They are an inexpensive way to raise capital without borrowing money.
5.
In most cases, before you can participate in a dividend reinvestment plan, you must purchase your original shares _________.
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From a broker. Most, but not all, companies require this.