New regulations require that dividends are taxed when paid

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Reference no: EM132030443

Air Taxi, Inc. has declared a $6.50 per-share dividend. Suppose capital gains are not taxed, but dividends are taxed at 16% and new regulations require that dividends are taxed when paid. Air Taxi stock sells for $116 per share.

What will the ex-dividend price be?

Dividend per share $6.50

Tax rate 16%

Price $116.00

Reference no: EM132030443

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