Suppose B&E Press paid dividends at the end of each year according to the schedule below. It also reduced its share counts by repurchasing 5 million shares at the end of each year at the ex-dividend stock prices shown.

A B D E F G H 4 2010 5 6 Suppose B&E Press paid dividends at the end of each year according to the schedule below. It also reduced its share 7 counts by repurchasing 5 million shares at the end of each year at the ex-dividend stock prices shown. 8 9 2009 2011 2012 2013 10 A) Ex-Dividend Stock Price ($/share) 10 12 8 11 15 11 B) Dividend ($/share) 0.5 0.5 0.5 0.5 12 C) Share Outstanding (millions) 100 95 90 85 80 13 D) Shares repurchased during the year (millions) 5 5 5 5 14 15 16 a) What is the total market value of B&E's equity, and what is the total amount paid out to 17 shareholders, at the end of each year? 18 19 2009 2010 2011 2012 2013 20 E) Ending Equity Value 21 F) Total Dividends 22 G) Total Repurchases 23 H) Total Payout 24 25 26 27 28 b) If B&E had made the same total payouts using dividends only (and so kept its share count constant), what dividends would it have paid and what would its ex-dividend share price have been each year? 29 30 2009 2010 2011 2012 2013 31 32 I) Dividends Only Shares J) Dividend ($ share) K) Stock Price (ex-div) 33 34 35 36 37 c) If B&E had made the same total payouts using repurchases only (and so paid no dividends), will the share price in each year higher or lower than your answers in part b)? 38 39 40 2009 2010 2011 2012 2013 41 42 43 L) Repurchases Only Beginning Shares M) Stock Price N) Shares Repurchased O) Ending Shares P) Ending Equity Value 44 45 46 47 48