FYE Corp. has a market capitalization of $13,500,000 and has 500,000 shares outstanding. FYE currently pays a $2 per-share dividend. Sam currently owns 100 shares of FYE. Answer the following questions. Assume no taxes.

a. What is the value of Sams investment after the dividend is paid (ie cash from the dividend plus share value)? Keep in mind the share price change after the dividend is paid.

b. Sam would prefer to receive a $1 per-share dividend. Show how Sam could achieve an equivalent cash flow while still invested in FYE Corp. Also show that Sams investment in FYE has the same value as in part (a).

c. Sam would prefer to receive a $3 per-share dividend. If it is possible, show how Sam could achieve an equivalent cash flow while still invested in FYE. Also show that Sams investment in FYE has the same value as in part (a).

d. Now assume Sam pays a 15% tax on dividends. Repeat (a), (b), and (c). How are the results different? Explain