A couple bought some stock for $20 per share that pays an annual dividend of $0.40 per share. After 2 years the price of the stock was $22. (a) What is the return on investment? (b) Find the simple interest rate on the growth of their investment.

A couple bought some stock for $20 per share that pays an annual dividend of $0.40 per share. After 2 years the price of the stock was $22. (a) What is the return on investment? (b) Find the simple interest rate on the growth of their investment.

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter7: Stocks (equity) - Characterstics And Valuation

Section: Chapter Questions

Problem 2PROB

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Question

4.) A couple bought some stock for $20 per share that pays an annual dividend of $0.40 per share. After 2 years the price of the stock was $22.

(a) What is the return on investment?

(b) Find the simple interest rate on the growth of their investment.

A couple bought some stock for $20 per share that pays an annual dividend of $0.40 per share. After 2 years the price of the stock was $22.
(a) What is the return on investment?
%
(b) Find the simple interest rate on the growth of their investment.
%

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