iteracom

Brainwasher, conceptually, you are correct about subtracting dividends in the P/C parity formula, however most of these questions given to us ignore dividends.

In the text for both Level I and II, dividends are ignored, but if they are given in the problem, they must be considered.

I agree that the FCFE question was unfair. I actually thought the tax rate given in the question stem was an intentional distraction designed to fool me into backing out the interest at 1-T.



Edited 1 time(s). Last edit at Monday, May 30, 2011 at 11:54AM by Hank Moody.