Final answer:
The expected return of Alberta Inc. (AI) can be calculated by adding the dividend yield and the stock price appreciation.
Step-by-step explanation:
In order to calculate the expected return of Alberta Inc. (AI), you need to consider both the dividend yield and the stock price appreciation. The dividend yield is calculated by dividing the annual dividend per share by the stock price per share. In this case, the dividend yield is $1.49 / $28.32 = 0.0526, or 5.26%. The stock price appreciation is calculated using the expected growth rate. Since AI's expected growth rate is 6%, the stock price appreciation is also 6%. To get the total expected return, add the dividend yield and the stock price appreciation. In this case, the expected return is 5.26% + 6% = 11.26%.