Which Statement Is True Concerning the One-Year After-Tax Return on the Following

question 89

Multiple Choice

Which statement is true concerning the one-year after-tax return on the following stocks, assuming a 40% tax rate on dividends and a 20% tax rate on capital gains: Stock A is purchased for $50, offers a 5% dividend yield, and is sold for $56; Stock B is purchased for $60, offers no dividend yield, but is sold after one year for $70.

• A)Stock A's after-tax return is higher by 1.27%.
• B)Stock B's after-tax return is higher by 0.73%.
• C)Stock A's after-tax return is higher by 0.27%.
• D)Stock B's after-tax return is higher by 0.58%.

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Definitions:

Defamation

The act of damaging someone's reputation through false statements.

Best Defence

The most effective legal argument or strategy used to achieve a favorable outcome in a legal case.

Innuendo

A statement or remark that indirectly suggests something derogatory, but does so without stating it directly.

False Rumour

An unfounded or untrue piece of information spread among people, which can potentially cause harm or misunderstanding without being based on facts.