You are a shareholder in a corporation

Finance Mar 01, 2021

You are a shareholder in a corporation. The corporation earns $7.50 per share before taxes. Once it has paid taxes, it will distribute the rest of its earnings to you as a dividend. The corporate tax rate is 35% and the personal tax rate on dividend income is 20%.How much is left for you after all taxes are paid? What is your total effective tax rate?

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