17-10A. (Repurchase ofstock) The Dunn Corporation is planning to pay dividends of $500,000.

There are 250,000 shares outstanding, with an earnings per share of$5. The stock should sen for

$50 after the ex-dividend date. If instead of paying a dividend, management decides to repurchase stock:

a. What should be the repurchase price?

b. How many shares should be repurchased?

c. What if the repurchase price is set below or above your suggested price in part (a)?

d. If you own 100 shares, would you prefer that the company pay the dividend or repurchase stock?