Question
An investor bought a stock for $ 17 (at t=0) and one year later it paid a $ 3 dividend (at t=1). Just after the
An investor bought a stock for $17 (at t=0) and one year later it paid a $3 dividend (at t=1). Just after the dividend was paid, the stock price was $7 (at t=1). Inflation over the past year (from t=0 to t=1) was 4% pa, given as an effective annual rate. Which of the following statements is NOT correct? The stock investment produced a:
Select one:
a. Nominal capital return of -58.823529% pa.
b. Nominal total return of 21.647059% pa.
c. Real capital return of -60.40724% pa.
d. Real income return of 16.968326% pa.
e. Real total return of -43.438914% pa.
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