Question: please calculate it by steps Question 4: (5 points) The Muscat Electricity company has 1,000 O.R of extra cash. It can retain the cash and
Question 4: (5 points) The Muscat Electricity company has 1,000 O.R of extra cash. It can retain the cash and invest it in the Treasury bills yielding 10 percent per year, or it can pay the cash to shareholders as a dividend. Shareholders can also invest in Treasury bills with the same yield. The corporate tax rate in Oman 15 percent, and there are no taxes on personal income. However, the maximum tax rate on the dividend income is 10 percent. How much cash will investors have after 5 years under each policy
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