The expected pretax return on three stocks is divided between dividends and capital gains in the following way: Expected Expected Stock Dividend Capital Gain $0 $10 5 10 A B 5 Required: a. If each stock is priced at $155, what are the expected net percentage returns on each stock to (1) a pension fund that does no pay taxes. (i) a corporation paying tax at 21% (the effective tax rate on dividends received by corporations is 6.3%), and (ii) an individual with an effective tax rate of 10% on dividends and 5% on capital gains? b. Suppose that investors pay 40% tax on dividends and 10% tax on capital gains. If stocks are priced to yield an after-tax return of 10%, what would A, B, and each sell for? Assume the expected dividend is a level perpetuity. Complete this question by entering your answers in the tabs below. Reg A ReqB If each stock is priced at $155, what are the expected net percentage returns on each stock to (i) a pension fund that does not pay taxes, (ii) a corporation paying tax at 21% (the effective tax rate on dividends received by corporations is 6.3%), and (II) an individual with an effective tax rate of 10% on dividends and 5% on capital gains? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) Show less Suppose that investors pay 40% tax on dividends and 10% tax on capital gains. If stocks are priced to yield an after-tax Stock Pension Investor Corporation Individual return of 10%, what would A, B, and each sell for? Assume the expected dividend is a level perpetuity. (Do not round intermediate calculations. Round your answers to 2 decimal places.) % % % B % % % Stock Price % % % B A