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Midnight Hour, Inc., has declared a dividend of $6.50 per share. Suppose capital gains are not taxed, but dividends are taxed at 20 percent. New

Midnight Hour, Inc., has declared a dividend of $6.50 per share. Suppose capital gains are not taxed, but dividends are taxed at 20 percent. New IRS regulations require that taxes be withheld at the time the dividend is paid. Midnight Hour sells for 494.55 per share, and the stock is about to go ex dividend.

What do you think the ex-dividend price will be?

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