Daylesford Company currently has 200000 outstanding shares selling at 110 dollars each. The firm has a current period cash flow of 10000000 dollars. The firm is contemplating the declaration of distributing all the current cash flow as cash dividends at the end of the fiscal year that just began. Assume the dividend tax rate is zero and the capital market is a perfect market.

(a): What will be the price of the stock on the ex-dividend date if the dividend is declared?

b): If, instead of paying a cash dividend, the firm distributes all the current cash flow by repurchasing shares at the current market price, how many shares will be repurchased? Round to the nearest integer if needed.

c): Suppose the board of directors of Daylesford Company announces its plan to pay out only 40% of its current cash flow as cash dividends to its shareholders. John currently owns 1000 shares of Daylesfords stock. In order to achieve a zero-payout policy on his own, how many shares should John buy? Round to the nearest integer if needed.

d) :Briefly explain why payout decisions are relevant to investment and financing decisions.