New share ownership after reinvesting dividends

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Sophie Chan owns 100,000 shares of PAT Company. PAT is selling for $40 per share, so her investment is worth $4,000,000. Chan reinvests the gross amount of all dividends received to purchase additional shares. Assume that the clientele for PAT shares consists of tax-exempt investors. If PAT pays a $1.50 dividend, what would be Chan's new share ownership after reinvesting dividends at the ex-dividend price?

Reference no: EM132203996

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