Jersey Medical earns $9.50 a share, sells for $80, and pays a $7 per share dividend. The stock is split two for one and a $3.5 per share cash dividend is declared. What will be the new price of the stock? Round your answer to the nearest dollar. $ If the firm's total earnings do not change, what is the payout ratio before and after the stock split? Round your answers to one decimal place. Payout ratio before the split: % Payout ratio after the split: %
Jersey Medical earns $9.50 a share, sells for $80, and pays a $7 per share dividend. The stock is split two for one and a $3.5 per share cash dividend is declared. What will be the new price of the stock? Round your answer to the nearest dollar. $ If the firm's total earnings do not change, what is the payout ratio before and after the stock split? Round your answers to one decimal place. Payout ratio before the split: % Payout ratio after the split: %
Chapter15: Dividend Policy
Section: Chapter Questions
Problem 5P
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Question
Jersey Medical earns $9.50 a share, sells for $80, and pays a $7 per share dividend. The stock is split two for one and a $3.5 per share cash dividend is declared.
-
What will be the new price of the stock? Round your answer to the nearest dollar.
$
-
If the firm's total earnings do not change, what is the payout ratio before and after the stock split? Round your answers to one decimal place.
Payout ratio before the split: %
Payout ratio after the split: %
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