Here is some data on the stocks of two companies. Both these companies are about the same size, have similar operations, and are in the same industry. Study the table provided and answer the questions that follow. Please make your answers as detailed as possible. Try to avoid one-line answers. Answer each question as completely as possible.

IMPORTANT:Before answering this question, please read the Mutual funds lesson on CNN Money, money.cnn.com. The link is below. Make sure to read all the pages in the lesson by following the links at the bottom of the page. Also, please make sure to read the definitions of these terms in chapter 12.

http://money.cnn.com/pf/money-essentials-stocks/index.html

	STOCK 1	STOCK 2
Stock price	$50	$100
Earnings per share (EPS)	$2	$10
EPS last year	$1.50	$11
Annual Dividend	$1.00	$4.00
Dividend yield	___ % (calculate)	___ % (calculate)
Beta	1.1	.8
Price to Earnings (PE) ratio	___ (calculate)	___ (calculate)

1. Calculate the dividend yield for both stocks. Interpret the meaning of the dividend yield (Explains what it means) for both stocks. Which stock is more attractive based on dividend yield?