Use the Information for the Question(s)below

question 50

Multiple Choice

Use the information for the question(s) below.
The JRN Corporation will pay a constant dividend of $3 per share,per year,in perpetuity.Assume that all investors pay a 20% tax on dividends and that there is no capital gains tax.The cost of capital for investing in JRN stock is 12%.
-Assume that management makes a surprise announcement that JRN will no longer pay dividends but will use the cash to repurchase stock instead.The price of a share of JRN's stock is now closest to:

• A)$20.00.
• B)$25.00.
• C)$18.00.
• D)$24.00.

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Definitions:

Communication Initiatives

Efforts or strategies implemented to improve or facilitate effective communication within an organization.

Competitors

Other businesses or entities that offer similar products or services, competing for the same market share.

Effective Hotlines

Confidential channels through which individuals can report unethical behavior or seek guidance on ethical dilemmas.

Anonymous Basis

Conducting activities or making communications without revealing one's identity, often for privacy, safety, or confidentiality reasons.