Acme Widget, Inc

Multiple Choice

Acme Widget, Inc. has one million shares of common stock outstanding at a price per share of $85. The company earned $5 million after taxes. The annual dividend is $3.50 per share. The firm has assets of $125,000,000 and liabilities of $25,000,000. What is the dividend yield?

A) 3.50 percent
B) 1.43 percent
C) 5.00 percent
D) 4.12 percent
E) 3.44 percent