+
YOU PURCHASE 100 SHARES OF STOCK FOR $50 A SHARE. THE STOCK PAYS A $2 PER SHARE

YOU PURCHASE 100 SHARES OF STOCK FOR $50 A SHARE. THE STOCK PAYS A $2 PER SHARE

Rating:
Rating
(0)
Author: simmons96 96
Description:

http://theperfecthomework.com/you-purchase-100-shares-of-stock-for-50-a-share-the-stock-pays-a-2-per-share-dividend-at-year-end/

You purchase 100 shares of stock for $50 a share. The stock pays a $2 per share dividend at year-end.

 
a.
What is the rate of return on your investment if the end-of-year stock price is (i) $48; (ii) $50; (iii) $54?(Leave no cells blank - be certain to enter "0" wherever required. Enter your answers as a whole percent.)

 
Stock price
      Rate of return
$48
 %  
$50
 %  
$54
 %  
 
b.
What is your real (inflation-adjusted) rate of return if the inflation rate is 3%? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. Negative amounts should be indicated by a minus sign.)

 
Stock price
     Real rate of return
$48
 %  
$50
 %  
$54
 %  


(more)
See More
Try a College Course Free

Sophia’s self-paced online courses are a great way to save time and money as you earn credits eligible for transfer to over 2,000 colleges and universities.*

Begin Free Trial
No credit card required

26 Sophia partners guarantee credit transfer.

226 Institutions have accepted or given pre-approval for credit transfer.

* The American Council on Education's College Credit Recommendation Service (ACE Credit®) has evaluated and recommended college credit for 21 of Sophia’s online courses. More than 2,000 colleges and universities consider ACE CREDIT recommendations in determining the applicability to their course and degree programs.

Tutorial