Suppose a stock had an initial price of $86 per share, paid a dividend of $1.70 per share during the year, and had an ending share price of $72.50.
1: Compute the percentage total return.
2: What was the dividend yield?
3: What was the capital gains yield?
Answer and Explanation:
= (Closing Price + Receipts - Opening price) / Opening Price x 100
= (72.50 + 1.70 - 86) / 86 x 100
= Dividend / Initial price x 100
= 1.70 / 86 x 100
Capital gains yield
= (Closing price - Opening price) / Opening price x 100
= (72.50 - 86) / 86 x 100
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from Intro to Business: Help and ReviewChapter 25 / Lesson 6
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