Assume capital markets are perfect. Kay Industries currently has 200 million invested in​ short-term Treasury securities

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Assume capital markets are perfect. Kay Industries currently has200 million invested in​ short-term Treasury securities paying 8%and it pays out the interest payments on these securities as adividend. The board is considering selling the Treasury securitiesand paying out the proceeds as a​ one-time dividend payment. Assumethat investors pay a 15% tax on dividends but no capital gainstaxes nor taxes on interest​ income, and Kay does not pay corporatetaxes.
a. If the board went ahead with this​ plan, what would happen tothe value of Kay stock upon the announcement of a change in​policy?
b. What would happen to the value of Kay stock on the​ex-dividend date of the​ one-time dividend?
c. Given these price​ reactions, will this decision benefit​investors?
If the board went ahead with this​ plan, what would happento the value of Kay stock upon the announcement of a changein​ policy?  ​(Select the best choice​ below.)
A.The value of Kay would fall by $200 million.
B.The value of Kay would rise by$200 million−$200 million×15%=$170 million.
C.The value of Kay would rise by $200 million.
D. The value of Kay would remain the same.
Part 2
b. What would happen to the value of Kay stock onthe​ ex-dividend date of the​ one-timedividend?  ​(Select the best choice​ below.)
A.The value of Kay would remain the same.
B.The value of Kay would fall by $200 million.
C.The value of Kay would fall by$200 million−$200 million×15%=$170 million.
D.The value of Kay would rise by $200 million.
Part 3
c. Given these price​ reactions, will this decisionbenefit​ investors?  ​(Select the bestchoice​ below.)
A.It will hurt investors.
B.​It's difficult to tell because the price reaction depends oninvestor preferences.
C.It will neither benefit nor hurt investors.
D.It will benefit investors.