# You bought a stock of XYZ one year ago for \$50 per share and sold it today for \$55 per share. It paid a \$1 per share dividend today.What was your realized return?How much of the return came from dividend yield and how much came from capital gain?       Assuming that the stock fell \$5 to \$45 instead.Is your capital gain different? Why or why not?Is your dividend yield different? Why or why not?

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You bought a stock of XYZ one year ago for \$50 per share and sold it today for \$55 per share. It paid a \$1 per share dividend today.

1. What was your realized return?
2. How much of the return came from dividend yield and how much came from capital gain?

Assuming that the stock fell \$5 to \$45 instead.

1. Is your capital gain different? Why or why not?
2. Is your dividend yield different? Why or why not?
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Step 1

1.

The realized return is 12%.

Computation of realized return:

Step 2

2.

The return from dividend yield and capital gain are 2% and 10%.

Computation of return from dividend yield and capital gain:

Step 3

If the stock price falls to \$45:

1.

Computation of return from capital gain:

Yes, there is a difference in return f...

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