Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

One year ago, you purchased stock ABC at price $ 1 0 . During the year, the company paid $ 1 per share as taxable

One year ago, you purchased stock ABC at price $10. During the year, the company paid $1 per share as taxable dividend. If you sell the stock at $13 today, what would be your realized after-tax return? Assume your marginal personal tax rate on income is 30% and the dividend tax credits of 12% can be applied.
a.
40%
b.
29.65%
c.
31.8%
d.
33.7%

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Microfinance Handbook An Institutional And Financial Perspective

Authors: Joanna Ledgerwood

1st Edition

0821343068, 978-0821343067

More Books

Students also viewed these Finance questions