P12-1 Calculating Returns [LO1] Suppose a stock had an initial price of $79 per share, paid...

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Question

P12-1 Calculating Returns [LO1] Suppose a stock had an initial price of $79 per share, paid a dividend of $17 per share durin

Answer 1

Answer #1

C. 13.54%

The return of any asset is the increase in price, plus any dividends or cash flows, all divided by the initial price. The return of this stock is:

Percentage total return = [($88 – $79) + $1.7] / $79 = 0.1354, or 13.54%

Answer 2

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