Given the earnings per share over the period 2012– 2019 shown in the following table, determine the annual dividend per share under each of the policies set forth in parts a through d.

Year                                 Earnings per share
2019 .....................................$1.40
2018 .......................................1.56
2017 .......................................1.20
2016 ......................................-0.85
2015 .......................................1.05
2014 .......................................0.60
2013 .......................................1.00
2012 .......................................0.44

a. Pay out 50% of earnings in all years with positive earnings.
b. Pay $0.50 per share and increase to $0.60 per share whenever earnings per share rise above $0.90 per share for 2 consecutive years.
c. Pay $0.50 per share except when earnings exceed $1.00 per share, in which case pay an extra dividend of 60% of earnings above $1.00 per share.
d. Combine the policies described in parts b and c. When the dividend is raised (in part b), raise the excess dividend base (in part c) from $1.00 to $1.10 per share.
e. Compare and contrast each of the dividend policies described in parts a through d.