Suppose that there are just three types of investors with the following tax rates: 15% 50% 17 Capital gains Individuals invest a total of $82.0 billion in stock and corporations inves: $12.40 billion. The remaining stock is held by the institutions. All three groups simply seek to maximize their after-tax income. These investors can choose from three types of stock offering the following pretax payouts per share: Low Payout Medium Payout High Payout $ 30 Dividend:s Capital gains 17 These payoffs are expected to persist in perpetuity. The low-payout stocks have a total market value of $102.0 billion, the medium-payout stocks have a value of $52.0 billion, and the high-payout stocks have a value of $122.0 billion. a. Who are the marginal investors that determine the prices of the stocks? b. Suppose that this marginal group of investors requires an after-tax return of 11%. What are the prices of the low, medium-, and high-payout stocks? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Price of low-payout stock Price of medium-payout stock Price of high-payout stock c. Calculate the after-tax retums of the three types of stock for each investor group. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Low-payout stock Medium-payout stock High-payout stock d. What are the dollar amounts of the three types of stock held by each investor group? (Leave no cells blank be certain to enter "O" wherever required. Round your answers to 2 decimal places.) Low-payout stock Medium-payout stock High-payout stock Suppose that there are just three types of investors with the following tax rates: 15% 50% 17 Capital gains Individuals invest a total of $82.0 billion in stock and corporations inves: $12.40 billion. The remaining stock is held by the institutions. All three groups simply seek to maximize their after-tax income. These investors can choose from three types of stock offering the following pretax payouts per share: Low Payout Medium Payout High Payout $ 30 Dividend:s Capital gains 17 These payoffs are expected to persist in perpetuity. The low-payout stocks have a total market value of $102.0 billion, the medium-payout stocks have a value of $52.0 billion, and the high-payout stocks have a value of $122.0 billion. a. Who are the marginal investors that determine the prices of the stocks? b. Suppose that this marginal group of investors requires an after-tax return of 11%. What are the prices of the low, medium-, and high-payout stocks? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Price of low-payout stock Price of medium-payout stock Price of high-payout stock c. Calculate the after-tax retums of the three types of stock for each investor group. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Low-payout stock Medium-payout stock High-payout stock d. What are the dollar amounts of the three types of stock held by each investor group? (Leave no cells blank be certain to enter "O" wherever required. Round your answers to 2 decimal places.) Low-payout stock Medium-payout stock High-payout stock
