1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Lyrx [107]
3 years ago
7

Lee Ann, Inc., has declared a $5.70 per-share dividend. Suppose capital gains are not taxed, but dividends are taxed at 20 perce

nt. New IRS regulations require that taxes be withheld when the dividend is paid. The company's stock sells for $94.15 per share and is about to go ex-dividend.
Required:
What do you think the ex-dividend price will be?
Business
1 answer:
castortr0y [4]3 years ago
7 0

Answer:

$89.59

Explanation:

After tax dividend = Dividend * (1-Tax)

After tax dividend = $5.70 * (1-20%)

After tax dividend = $5.70 * 0.8

After tax dividend = $4.56

Ex-Dividend price = Share price - After tax dividend

Ex-Dividend price = $94.15 - $4.56

Ex-Dividend price = $89.59

You might be interested in
Assume that the risk-free rate of interest is 6% and the expected rate of return on the market is 16%. A share of stock sells fo
Tju [1.3M]

Answer: Price of stock at year end =$53

Explanation:

we first compute the Expected rate of return using the CAPM FORMULAE that

Expected return =risk-free rate + Beta ( Market return - risk free rate)

Expected return=6% + 1.2 ( 16%-6%)

Expected return= 0.06 + 1.2 (10%)

Expected return=0.06+ 0.12

Expected return=0.18

Using the formulae Po= D1 / R-g  to find the growth rate

Where Po= current price of stock at $50

D1= Dividend at $6 at end of year

R = Expected return = 0.18

50= 6/ 0.18-g

50(0.18-g) =6

9-50g=6

50g=9-6

g= 3/50

g=0.06 = 6%

Now that we have gotten the growth rate and expected return, we can now determine the price the investors are expected to sell the stock at the end of year.

Price of stock = D( 1-g) / R-g

= 6( 1+0.06)/ 0.18 -0.06

=6+0.36/0.12

=6.36/0.12=  $53

3 0
3 years ago
What is a key factor you should consider when determining asset allocation
scoray [572]

Answer: Did u find out the anser?

Explanation: Im taking the quiz now

8 0
2 years ago
Kubin Company’s relevant range of production is 11,000 to 14,000 units. When it produces and sells 12,500 units, its average cos
erastovalidia [21]

Answer:

a. $142,500

b. $86,250

Explanation:

a. The computation of the total direct manufacturing cost is shown below:

= (Direct material per unit + direct labor per unit)  × number of units manufactured

= ($7.20 + $4.20) × 12,500 units

=  $142,500

b. The computation of the total indirect manufacturing cost is shown below:

= (Variable manufacturing overhead per unit + Fixed manufacturing overhead per unit)  × number of units manufactured

= ($1.70 + $5.20) × 12,500 units

=  $86,250

8 0
3 years ago
A local swimming pool charges nonmember $10 per visit. If you join the pool, you can swim for $5 per visit but you have to pay a
ratelena [41]

Answer:

The answer is below

Explanation:

Using an optimal choice model to find the value of F such that you are indifferent between joining and not joining.

Let N be the number of visits per year

1) N-number of visits per year 10N=5N+F

Given that 10N=5N+F

Hence F=5N

F = 5N

2) Therefore, Would I go to the pool more or fewer times than if i did not join?

Then, if F is fixed and I join the local Swimmng pool member, I would go more times.

7 0
2 years ago
Financial markets and channel to . They also channel money from individuals who want to for the future to those who need cash to
Monica [59]

Answer:

financial intermediaries, saving, real investment, save, mutual funds, ETF, commodity market, shares, stock market, banks, CFO, liquids

Explanation:

The Question is incomplete. Here Is the complete Question.

Fill in the blanks in the following passage by choosing most appropriate word from the list:  CFO, save, financial intermediaries, stock market, saving, real investment, bonds, commodity markets, mutual funds, shares, liquids, ETFs, banks. each term should be used only once.

Financial market and ________ channel______ to_____ . They also channel money from individuals who want to_________ for the future to those who need cash to spend today. A third function of financial markets is to allow individuals and businesses to adjust their risk. For example,______ , such as the Vanguard Index fund, and ______, such as SPDR's or "spiders," allow individuals to spread their risk across a large number of stocks. Financial markets provide other mechanisms for sharing risks. For example, a wheat farmer and a baker may use the______ to reduce their exposure to wheat prices. Financial markets and intermediaries allow investors to turn an investment into cash when needed. For example, the_______ of public companies are because they are traded in huge volumes on the______ .  ________ are the main providers of payment services by offering checking accounts and electronic transfers. Finally, financial markets provide information. For example, the______ of a company that is contemplating an issue of debt can look at the yields on existing______ to gauge how much interest the company will need to pay.

7 0
2 years ago
Other questions:
  • You work for Whittenerg Inc., which is considering a new project whose data are shown below. What is the project's Year 1 cash f
    6·1 answer
  • On a timeline, a goal that will be achieved in __________ years will be to the right of one that will be achieved in __________
    10·2 answers
  • Lula thinks that people who discipline their children by spanking should be sent to jail and says she would be glad to go to jai
    11·1 answer
  • Which of the following might vary in on online purchase depending on where the purchaser lives?
    14·2 answers
  • The fact that corporate travelers are less price sensitive than most leisure travelers because the corporation pays for the trav
    5·1 answer
  • Emma, the marketing manager, is constantly seeking information about her competition while looking online or speaking to people.
    6·1 answer
  • The members of a certain business run the risk of losing their personal property should the enterprise fail. This is because the
    10·1 answer
  • According to the Sports Business Journal, Levy Restaurants is the leading purveyor of premium food at major sports venues. It ha
    13·1 answer
  • What is the world's largest free trade area?
    14·2 answers
  • Quick-as-Lightning, a delivery service, purchased a new delivery truck for $40,000 on January 1, 2019. The truck is expected to
    12·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!