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A company just announced a 10.00% stock dividend. The stock closed at $49.04 the day before...

A company just announced a 10.00% stock dividend. The stock closed at $49.04 the day before the ex-dividend date. Assuming no other events happened overnight, what will be the opening price for the stock on the ex-dividend date?

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Answer #1

Opening Price after Stock Div = Price before Stock DIv / [ 1 + Stock Div ]

= $ 49.04 / [ 1 + 0.1 ]

= $ 49.04 / 1.1

= $ 44.58

OPening Price on Exdiv Date is $ 44.58

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