When shares are sold "EX-DIV" it means that?

Assessment: WAEC SSCE - Commerce - 2002 (Objective) Subject: Commerce

Question 1 Report

When shares are sold "EX-DIV" it means that?
Answer Details
When shares are sold "EX-DIV," it means that the buyer of the shares is not entitled to the dividend that the company has already declared but has not yet paid. The dividend is paid to whoever owns the shares on the record date. The ex-dividend date is set by the stock exchange and is usually two business days before the record date. If a buyer purchases the shares on or after the ex-dividend date, they will not receive the upcoming dividend payment, and it will be paid to the seller instead. Therefore, the answer is that no dividend is paid on the shares when they are sold ex-div.
Read lesson note on Stock Exchange (JAMB)
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