1.Assume that it is 2008. You purchased CSH stock for $20 one year ago and it is now selling for $32. The company has announced that it plans a $12 special dividend. You are considering whether to sell the stocknow, or wait to receive the dividend and then sell.

a. Assuming 2008 taxrates, whatex-dividend price of CSH will make you indifferent between selling now andwaiting?

b. Suppose the capital gains tax rate is 20% and the dividend tax rate is 42%, whatex-dividend price would make you indifferentnow?

2.Suppose the stock of Host Hotels& Resorts is currently trading for $20 per share.

a. If Host issued a 20% stockdividend, what will its new share pricebe?

b. If Host does a 3: 2 stocksplit, what will its new share pricebe?

c. If Host does a 1: 3 reversesplit, what will its new share pricebe?