Consider the following equation: P_cum - P_ex= Div × The term P_ex is: A)the personal tax rate for dividend. B)the price per share before a dividend is paid. C)the price per share after a dividend is paid. D)the personal tax rate for capital gains.

Question

Quizplus · Accepted Answer

P_ex refers to the price per share after a dividend is paid (ex-dividend price). In this equation, it is being subtracted from the cum-dividend price (P_cum) to calculate the amount of dividend (Div) per share. The other options (A, B, and D) do not accurately describe P_ex in this context.

Consider the Following Equation