You are a shareholder in a C corporation. The corporation earns $2 per share before taxes. Once

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You are a shareholder in a C corporation. The corporation earns $2 per share before taxes.

Once it has paid taxes it will distribute the rest of its earnings to you as a dividend. The corporate tax rate is 40% and the personal tax rate on (both dividend and non-dividend) income is 30%. How much is left for you after all taxes are paid?

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Corporate Finance

ISBN: 9781292304151

5th Global Edition

Authors: Jonathan Berk, Peter DeMarzo

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