You Own 100 Shares in Each of Two Different Companies,Ace

question 8

Multiple Choice

You own 100 shares in each of two different companies,Ace Holdings,and Beta Inc.Ace Holdings earns $6.00 per share before taxes,has a corporate tax rate of 25%,and pays out 50% of its after-tax earnings as dividends.Beta Inc.earns $4.00 per share before taxes,has a corporate tax rate of 15%,and pays out 100% of its after-tax earnings as dividends.The tax rate on dividend income is 15%.If all of your shares are held outside a TFSA,what is the total after-tax income you receive from your dividends?

• A)$191.25
• B)$289.00
• C)$480.25
• D)$565.00
• E)$739.00

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Definitions:

Inconsistent Product Definition

A situation where there is a lack of uniformity or clarity in outlining the features and specifications of a product, leading to confusion or variability in production.

Goods And Services

Products that satisfy human wants or needs, which can be tangible items or intangible services.

Knowledge-Based

A system or process that is driven by the understanding, skills, and expertise of its participants rather than by mere access to raw data.

Inconsistent Product Definition

A scenario where there is a lack of clarity and coherence in the features, specifications, and requirements of a product across different stages of its development.