Simon and Simon, makers of cell phones, has a history of paying a dividend of $1.00 per share to their shareholders. Which of the following describes the likely response to the per share price of Simon and Simon with respect to the dividend?

a.

The stock price will rise by more than $1 on the record date

b.

The stock price will not rise nor fall on any of these dates

c.

The stock price will fall by $1 on the ex-dividend date

d.

The stock price will fall by more than $1 on the record data

e.

The stock price will rise by $1 on the ex-dividend date

EsIMPLE is a firm with a stock price of $50 per share. The firm has decided to not pay the usual dividend of $2.50 per share. Kelly, a shareholder on the record of EsIMPLE, has 400 shares that she purchased two years ago for $35 per share. Kelly needs cash and decides to create for herself the $2.50 dividend that she would have received as a shareholder. Which of the following comes closest to the amount that Kelly gets to keep from this transaction of creating the dividend if the tax rate on capital gains is 20%?

	a.	$760
	b.	$940
	c.	$1,000
	d.	$840
	e.	$800