Question

One year ago, you purchased a stock at a price of $55.49 per share. today, you sold your stock at a loss of 18.67 percent. your capital loss was $12.71 per share. what was the total dividends per share paid on this stock over the year? multiple choice

a. $2.14
b. $2.61
c. $2.35
d. $3.88
e. $4.24

Answer 1

The total dividends per share paid on the stock over the year are calculated by subtracting the loss due to the decrease in stock price from the total capital loss per share. The final amount is $2.35 per share, which corresponds to option (c).

Step-by-step explanation:

The question asks us to calculate the total dividends per share paid on a stock over the year, given that the stock was purchased at $55.49 per share and sold at an 18.67% loss, with a capital loss of $12.71 per share. To find the selling price per share, we first need to calculate the loss amount by applying the percentage loss to the original price.

The loss per share is 18.67% of $55.49, which can be calculated as: $55.49 * 0.1867 = $10.36 (the loss due to the decrease in stock price).

We know that the actual capital loss per share is $12.71, which includes both the price decrease and the dividends paid. Therefore, the amount in dividends is the difference between the total capital lost per share and the price decrease due to loss in stock value: $12.71 - $10.36 = $2.35.

Hence, the correct answer is $2.35 per share, which is option (c).