elizabeth eaarns $9.50 a share, sells for $90, and pays a $6 per sharedeviden. the stock is split two for one and a $3 pers share cash dividend is diclared. what will be the new price of the stock? if the firms total earnings to do not change, what is the payout ratio before and after stock split?

Essentials Of Investments
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Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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elizabeth eaarns $9.50 a share, sells for $90, and pays a $6 per sharedeviden. the stock is split two for one and a $3 pers share cash dividend is diclared.

what will be the new price of the stock?

if the firms total earnings to do not change, what is the payout ratio before and after stock split?

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Calculation of new price of the stock:

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Step 2

Calculation of payout ratio before the stock split:

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