Question
You need to complete this problem in a spreadsheet and show all your work. Create an excel file that shows your calculations. Clearly indicate your
You need to complete this problem in a spreadsheet and show all your work. Create an excel file that shows your calculations. Clearly indicate your final answer(s). Name the file with the following convention: Lastname-Problem#.xlsx. For instance, Roark-Problem1.xlsx.
Assume that you purchased stock in Buffalo Wildlings Inc for $26 per share. The following chart shows your dividends and the end of year price for each of the past six years:
Year | Dividends | Ending Price |
1 | $0.80 | $27.50 |
2 | $0.84 | $32.50 |
3 | $0.88 | $29.34 |
4 | $0.94 | $28.12 |
5 | $1.02 | $36.05 |
6 | $1.08 | $29.95 |
a) Calculate the dividend yield, the capital gains yield and the total return for each year.
b) Calculate the arithmetic average rate of return for the 6 year period.
c) Calculate the geometric average rate of return for the 6 year period.
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