The Beta Corporation Has 1,000 Shares Outstanding and a Market

question 34

Multiple Choice

The Beta Corporation has 1,000 shares outstanding and a market value of $90,000.What will be the market value per share after the firm distributes a $5 per share dividend? Ignore taxes and market imperfections.

• A) $90
• B) $85
• C) $80
• D) $87.50

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Definitions:

Majority Vote

A decision-making process in which the option that receives more than half of the votes wins.

Marginal Benefits

The additional satisfaction or utility gained from consuming or producing one more unit of a good or service.

Proposed Tax

A proposed tax is a tax plan or suggestion that is being considered for implementation but has not yet been enacted.

Recreation Center

A facility intended for recreational activities, sports, and other leisure activities.