Question

Marcy owns common stock in Rex's Pet Planet. The annual dividend is $2.05. The current price is$5.37. What is the yield of the stock?

A. 31.7%.
B. 33.2%.
C. 38.2%.
D. 53.7%.

Answer 1

The yield of the stock for Marcy's common stock in Rex's Pet Planet is 38.2%, which is closest to Option C.

Step-by-step explanation:

To calculate the yield of the stock for Marcy's common stock in Rex's Pet Planet, we use the following formula:

Yield (%) = (Annual Dividend per Share / Current Price per Share) × 100

Inserting Marcy's figures into the formula gives us:

Yield (%) = ($2.05 / $5.37) × 100

Yield (%) = 0.38174954 × 100

Yield (%) = 38.17%

Therefore, the yield of the stock is closest to Option C, which is 38.2%.