It Is August 14th and John Has Just Purchased 100

question 67

Multiple Choice

It is August 14th and John has just purchased 100 shares of Cash Cow Inc.for $1,200 with a settlement date of August 16th.Cash Cow recently declared a dividend of $1.00 per share payable to shareholders of record as of August 15th.How much money did John pay for the right to the recently declared dividend?

• A)John paid $100.00 for the dividend because he purchased the stock prior to the dividend record date.
• B)John paid $50.00 for the dividend because the record date was between purchase date of August 14th and the settlement date of August 16th.Therefore,the dividend payment is shared equally between the previous owner of the stock and John.
• C)John paid $0.00 for the dividend because he was not the shareholder of record on August 15th.Therefore,the dividend payment went to the previous owner of the stock.
• D)This is a complicated issue and not easily answered.Thus,there is not enough information to answer this question.

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Definitions:

PiLive

Not a commonly acknowledged key term, therefore NO.

People-centered Practices

Management strategies that prioritize the well-being, development, and engagement of employees within an organization.

Pfeffer

Likely referring to Jeffrey Pfeffer, a notable business theorist known for his work on organization theory and human resource management.

Job Security

The likelihood that an individual will keep their job without the risk of becoming unemployed.