Question: 1. Dividends and Taxes (LO2] Ginger, Inc., has declared a $5.35 per share dividend. Suppose capital gains are not taxed, but dividends are taxed at

1. Dividends and Taxes (LO2] Ginger, Inc., has declared a $5.35 per share dividend. Suppose capital gains are not taxed, but dividends are

1. Dividends and Taxes (LO2] Ginger, Inc., has declared a $5.35 per share dividend. Suppose capital gains are not taxed, but dividends are taxed at 15 percent. New IRS regulations require that taxes be withheld at the time the dividend is paid. The company's stock sells for $74.20 per share, and the stock is about to go ex dividend. What do you think the ex-dividend price will be? Chapter 17 Question 1 Input Area: $ Dividend per share Tax rate Price 5,35 15% 74,20 $ Output Area: After-tax Dividend $ 4,55 Ex-dividend price

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