Suppose you buy csh stock for 40 and its now selling for, Ask an Expert

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You purchase CSH stock for $40 and it is now selling for $50. The company has announced that it plans a $10 special dividend. Assuming 2008 tax rates, if you sell the stock or wait and receive the dividend, will you have different after tax income? If the capital gains tax rate is 33% and the dividend tax rate is 42%, what is the difference between the two options in part (a)?

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Corporate Finance, Finance

Category:- Corporate Finance
Reference No.:- M9222521

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