How Stock Repurchases Differ from Dividends: You Purchased 2,500 Shares

question 32

Multiple Choice

How stock repurchases differ from dividends: You purchased 2,500 shares of DotCom.com several years ago for $40 per share. The company is offering a fixed-price tender offer repurchase for $54 per share. What is the amount of after-tax proceeds you would receive from taking part in the repurchase if capital gains are taxed at 15 percent?

• A) $120,000
• B) $121,250
• C) $129,750
• D) $135,000

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