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A corporation has after (corporate) tax earnings that would allow a $2 dividend per share to be paid to its stockholders. If these dividends are
A corporation has after (corporate) tax earnings that would allow a $2 dividend per share to be paid to its stockholders.
If these dividends are paid, the firm will be unable to invest in new projects, and its stock price, currently $60 per share , probably will not change.
Calculate the return to the firms stockholders in this case.
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