You find a stock priced at $35 that is expected to pay a dividend of $1.50 next year. If you also expect the price to be $37 next year, what is the expected return on the stock?
A. 5.71%
B. 10.00%
C. 1.43%
D. -1.35%
expected return=(End value-Beginning value+Dividend)/Beginning value
=(37-35+1.5)/35
=10%
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