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You buy a share of stock of Falmouth Corporation (FC) for $50.00. The stock is expected...

You buy a share of stock of Falmouth Corporation (FC) for $50.00. The stock is expected to pay a dividend of $1 at the end of the year and sell for $55.00 at that time. What is the expected return on the FC stock?

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Answer #1

Expected Return = (Sale Price+Dividend-Purchase Price)/Purchase Price (55+1-50)/50 0.12 12.00%

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