Question
Asked Oct 14, 2019

You purchased a stock at a price of $22.  A year later the stock is worth $35, and during the year it paid $1.5 in dividends.  What was the rate of return you earned on this investment?

check_circleExpert Solution
Step 1

Hence, return on the investment is $14.5.

Return on investment is calculated by adding capital appreciation with the amount of dividend paid during...

Return = Capital appreciation +Dividend
-(S35-$22)+$1.5
=$14.5
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Return = Capital appreciation +Dividend -(S35-$22)+$1.5 =$14.5

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