Suppose that all capital gains are taxed at a $27\%$rate$,$ and that the dividend tax rate is $37\%.$ Arbuckle Corp. is currently trading for $$$$31,$ and is about to pay a $$$$5$ special dividend.

a$.$ Absent any other trading frictions or$$ news, what will its share price be just after the dividend is$$ paid?

Suppose Arbuckle made a surprise announcement that it would do a share repurchase rather than pay a special dividend.

b$.$ What net tax savings per share for an investor would result from this$$ decision?

c$.$ What would happen to$$ Arbuckle's stock price upon the announcement of this$$ change?