What is the effective dividend tax rate

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Ant Financial's stock price dropped for $5 after paying a special dividend of $10. Assume capital gain tax rate is 20% and dividend tax rate is 50%. An investor buys the share right before the ex-dividend date and immediately sells it after receiving the divided.

a. What is the effective dividend tax rate?

b. How much tax the investor needs to pay per share on her dividend income?

c. How much total tax the investor needs to pay per share after considering bothdividend and capital loss?

d. How much profit the investor can make per share?

e. Does not need to be extended detailed, just how to get the answer.

Reference no: EM133114163

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