Question

One year ago, you purchased 100 shares of a stock. This morning you sold those shares and realized a total return of 8.2 percent. Given this information, you know for sure the:a. stock price increase by 8.2 percent over the last yearb. stock increased in value over the past yearc. stock paid a dividendd. dividend yield is greater than zeroe. sum of the dividend yield and the capital gains yeilds is 8.2 percent

Answer 1

E

Step-by-step explanation:

From the statement given in the question the shares are sold after a holding period of one year.

the total realized return is 8.2%. in order to arrive to this we usually consider the amount of dividend received plus the selling price.

the above total is divided by the purchase price of 100 shares.

for example dividend is $2 and selling price is $106.2 so the total leads to $108.2

where as we assume the share price is $100

when we divide 108.2/100 we get 1.082 and minus 1 from it we get 0.082

in order to get %age we multiply by 100 so we get 8.2%.

Hence total return includes sum of dividend yield and capital gain yield.