22) You buy a stock for $30 per share and sell it for $33 after holding it for slightlyover a year and collecting a $0.75 per share dividend. Your ordinary income taxrate is 28 percent and your capital gains tax rate is 20 percent. Your after-taxrate of return isto e asse (8A) 12.50 percent.B) 9.80 percent.C) 8.75 percent.D) 8.00 percent.E) None of the above22)ries

The after-tax rate of return reflects the overall profitability of the investment after considering…

Answered: You buy a stock for $30 per share and…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Similar questions

You buy a stock for $47 per share and sell it for $50 after holding it for slightly over a year and collecting a $4 per share dividend. If dividend incone is taxed at a 20% rate and capital gains are taxed at 25%, what is your after tax holding period return? (Write your answer in percentage and round it to 2 decimal places)
You buy stock for $30 per share and sell it for $33 per share after holding it for slightly after a yer and collecting a $0.75 per share dividend. Youre ordinary income tax rate is 28% and your capital gains tax rate is 20%. Youre after tax return rate is? A. 8.00% B. 10.25% C. 12.5% D. 9.8% E.8.75%
You buy a stock for $46 per share and sell it for $58 after holding it for slightly over a year and collecting a $3.9 per share dividend. If dividend income is taxed at a 24% rate and capital gains are taxed at 22%, what is your after-tax holding period return? (Write your answer in percentage and round it to 2 decimal places)
You buy a stock for $47 per share and sell it for $58 after holding it for slightly over a year and collecting a $5.9 per share dividend. If dividend income is taxed at a 28% rate and capital gains are taxed at 24%, what is your after-tax holding period return?
One year ago, you purchased stock ABC at price $10. During the year, the company paid $1 per share as taxable dividend. If you sell the stock at $13 today, what would be your realized after - tax return? Assume your marginal personal tax rate on income is 30% and the dividend tax credits of 12% can be applied. a. 29.65% b. 40% c. 33.7% d. 31.8%
buy a stock for $41 per share and sell it for $59 after holding it for slightly over a vear and collecting a $4.7 per share dividend, If dividend income is taxed at a 25% rate and capital gains are taxed at 29%, what is your after-tax holding period return? (Write your answer in percentage and round it to 2 decimal places)
You purchased a stock at the end of last year at a price of $98. At the end of this year, the stock pays a dividend of $2.10 and you sell the stock for $107. What is your return for the year? Now suppose that dividends are taxed at 15 percent and long-term capital gains (over 11 months) are taxed at 30 percent. What is your aftertax return for the year? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) Pretax return 11.33 % Aftertax return %
14. One year ago you purchased 100 shares of Dog Bites common stock for $25. You received dividends of $.70 per share and just sold the shares for $26.25 each. Your marginal personal tax rate is 40%, your dividend tax rate is 30%, and capital gains are taxed at 50% of your personal rate. a-1. What is your before-tax rate of return? (Round your answer to 2 decimal places.) a-2. What is your after-tax rate of return? (Round your answer to 2 decimal places.)
You buy stock for $34 per share and sell it for $36 after you collect a $1 per share dividend, your pre tax capital gain is _______________, and your pre tax dividend is ____________? A. 2.94%; 2.78% B. 8.82%; 0.00% C. 5.88%; 2.94% D. 5,56%; 2.78% E. 4.65%; 3.71%
Find the after-tax return to a corporation that buys a share of preferred stock at $42, sells it at year-end at $42, and receives a $5 year-end dividend. The firm is in the 30% tax bracket. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
You buy a stock for $34 per share and sell it for $36 after you collect a $1.00 per share dividend. Your pre-tax capital gain yield is ________________ and your pre-tax dividend yield is ________________. A. 5.88%; 2.94% B. 2.94%; 2.78% C. 8.82%; 0.00% D. 5.56%; 2.78%
Find the after-tax return to a corporation that buys a share of preferred stock at $58, sells it at year-end at $58, and receives a $4 year-end dividend. The firm is in the 21% tax bracket. (Round your answer to 2 decimal places.)

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