SIE Exam Practice Question 41
Question: 41
What is the dividend amount that a shareholder who owns 100 shares will receive in the following scenario?
ABC Corporation declared a $0.25 dividend to shareholders of record on Monday, December 5, payable on December 15. The closing price of ABC Corporation stock on December 5 is $20.34.
Correct Answer: C
Explanation:
A shareholder who owns 100 shares will receive $25.00 (100 × 0.25). The price of the stock does not affect the dividend payout. Dividends are usually declared quarterly, though some companies may do it annually. A dividend yield would be the sum of the quarterly payouts (e.g. $0.25 × 4 = $1) divided by the current price of the stock (e.g. 1/25.34 = 0.039 = 3.9%).
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