Question: Please help solve the questions attached to this post. Thanks 1- The HNH Corporation will pay a constant dividend of $ 3.00 per share, per

Please help solve the questions attached to this post.

Thanks

1- The HNH Corporation will pay a constant dividend of $ 3.00 per share, per year, in perpetuity. Assume all investors pay a 15 % tax on dividends and that there is no capital gains tax. Suppose the other investments with equivalent risk to HNH stock offer an after-tax return of 10 %. a. What is the price of a share of HNH stock? b. Assume that management makes a surprise announcement that HNH will no longer pay dividends but will use the cash to repurchase stock instead. What is the price of a share of HNH stock now? 2- Suppose that all capital gains are taxed at a 17 % rate, and that the dividend tax rate is 48 %. Arbuckle Corp. is currently trading for $44, and is about to pay a $4 special dividend. a. Absent any other trading frictions or news, what will its share price be just after the dividend is paid? (please round to the nearest cent)

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