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What? ex-dividend price would make you indifferent? now

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Assume that it is 2008. You purchased CSH stock for ?$22 one year ago and it is now selling for ?$33. The company has announced that it plans a ?$11 special dividend. You are considering whether to sell the stock? now, or wait to receive the dividend and then sell.

a. Assuming 2008 tax? rates, what? ex-dividend price of CSH will make you indifferent between selling now and? waiting?

In? 2008, the capital gains tax rate is 15 % and the dividend tax rate is 15 %. The tax on a ?$11 capital gain is ?$_______ and the tax on a ?$11 special dividend is ?$______. The? after-tax income for both will be ?$_______.

?(Round to the nearest? cent.)

b. Suppose the capital gains tax rate is 25 % and the dividend tax rate is 38 %?, what? ex-dividend price would make you indifferent? now?

Reference no: EM132384810

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