1. Assume a stock you have been planning to buy has declared an upcoming dividend of $2 per share. Broadly speaking, it is smarter to purchase the stock before the ex-dividend date, rather than on or after the ex-dividend date, because this way you will receive the dividend and be a little bit richer.

a. True b. False

2. Apple makes a surprise announcement today that they are switching their iPhone glass supplier from sapphire screens to Gorilla Glass, made by Corning, for the next five years. This will result in an additional $450 million in free cash flow for Corning, starting in one year, and growing at 5% per year thereafter through year 5. Corning has 951 million shares outstanding, 100 million net debt, and a WACC of 8.0%. Which of these is the most likely Corning stock price reaction when Apple made this announcement?

a. Increased $2

b. Increased $5

c. No change

d. Decreased $2

e. Decreased $5