Question
A stock is selling today for $75 per share. At the end of the year, it pays a dividend of $3 per share and sells
A stock is selling today for $75 per share. At the end of the year, it pays a dividend of $3 per share and sells for $84.
Required:
a. What is the total rate of return on the stock?
b. What are the dividend yield and percentage capital gain?
c. Now suppose the year-end stock price after the dividend is paid is $69. What are the dividend yield and percentage capital gain in this case?
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Lessons In Corporate Finance
Authors: Paul Asquith, Lawrence A. Weiss
2nd Edition
1119537835, 978-1119537830
