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You purchase 110 shares of stock for $42 a share. The stock pays a $4 per share dividend at year-end. What is the rate of
You purchase 110 shares of stock for $42 a share. The stock pays a $4 per share dividend at year-end. What is the rate of return on your investment for these end-of-year stock prices? What is your real (inflation-adjusted) rate of return? Assume an inflation rate of 5%. a. nd-of-year stock price = $37 Rate of return ? Real rate ? b. nd-of-year stock price = $42 Rate of return ? Real rate? c. nd-of-year stock price = $46 Rate of return ? Real rate ?
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