Answered

At Westonci.ca, we make it easy to get the answers you need from a community of informed and experienced contributors. Discover solutions to your questions from experienced professionals across multiple fields on our comprehensive Q&A platform. Connect with a community of professionals ready to help you find accurate solutions to your questions quickly and efficiently.

Calculating Returns Suppose a stock had an initial price of $87 per share, paid a dividend of $2.15 per share during the year, and had an ending share price of $98. Compute the percentage total return. What was the dividend yield? The capital gains yield? LO 1 ros13952_ch10_310-349.indd 343 12/24/18 5:11 PM 344 part 6 Risk and Return 2. Calculating Returns Rework Problem 1 assuming the ending share price is $78.

Sagot :

When ending share price is $98, capital gain yield is 12.64% and dividend yield is 2.47%. Percentage total return is 15.11%. When ending share price is $78, percentage price return is  -7.87%.

What is the percentage total return?

The price return on a stock has two components; the price appreciation and the dividend yield.

Percentage price return = price appreciation + dividend yield

Price appreciation = (price in on year - initial price) / initial price

Dividend yield = dividend / initial price

Percentage price return when ending share price is $98:

Capital gain yield = [(98 /87) - 1 ] = 12.64%

Dividend yield = (2.15/87) = 2.47%

Percentage price return when ending share price is $78:

Capital gain yield = [(78/87)  - 1] = -10.34%

Dividend yield = (2.15/87) =2.47%

Percentage price return = -7.87%

To learn more about dividend yield, please check: https://brainly.com/question/27342287

#SPJ1

Thank you for trusting us with your questions. We're here to help you find accurate answers quickly and efficiently. Thanks for stopping by. We strive to provide the best answers for all your questions. See you again soon. Westonci.ca is committed to providing accurate answers. Come back soon for more trustworthy information.