Question

The board of directors of DDT Inc. declared a dividend of $0.75 per share payable on Monday, January 28 to shareholders of record as of Monday, January 14. You owned 500 shares of DDT on Wednesday, January 9 when the price was $7.50 per share. Assuming no taxes and perfect markets, if you sell your 500 shares of DDT on Friday, January 11, how much in total will you receive from the sale, all else the same?

Answer 1

By selling 500 shares of DDT Inc. at a price of $7.50 per share, you would receive a total of $3,750 from the sale.

Step-by-step explanation:

If you sell your 500 shares of DDT Inc. on Friday, January 11th, the total amount you will receive from the sale will be calculated by multiplying the number of shares by the price per share. Since you own 500 shares and the price per share is $7.50, the total proceeds from the sale will be 500 shares × $7.50 per share, giving us $3,750. This calculation does not take into account any potential changes in the stock price between January 9th and January 11th, as the question specifies 'all else the same.' Therefore, it assumes you will sell the shares at the same price as on January 9th.