At the beginning of the year, you purchased a share of stock for $45. Over the...

At the beginning of the year, you purchased a share of stock for $45. Over the year the dividends paid on the stock were $2.20 per share.

a. Calculate the return if the price of the stock at the end of the year is $40. (Negative amount should be indicated by a minus sign. Round your answer to 2 decimal places. (e.g., 32.16))
b. Calculate the return if the price of the stock at the end of the year is $50. (Round your answer to 2 decimal places. (e.g., 32.16))


a.	Return	%
b.	Return	%

Solutions

Expert Solution

Return= ((Expected price at year end - Current price + dividend)/Current price)*100

(a)Return=((40-45+2.2)/45)*100

=-6.22%

(b)Return=((50-45+2.2)/45)*100

=16%

jeff jeffy answered 2 years ago

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