(Calculating the geometric and arithmetic average rate of return) The common stock of the Brangus Cattle Company had the following end-of-year stock prices over the last five years and paid no cashdividends:Time129314422528(Click on the icon in order to copy its contents into a spreadsheet)Brangus cattle Comapny$17a. Calculate the annual rate of return for each year from the above information.b. What is the arithmetic average rate of return earned by investing in Brangus Cattle Company's stock over this period?a. The annual rate of return at the end of year 2 is% (Round to two decimal places.)

Stocks or equity in a corporation represents fractional ownership in the organization. The units…

(Calculating the geometric and arithmetic average rate of return) The common stock of the Brangus Cattle Company had the following end-of-year stock prices over the last five years and paid no cash dividends: Time 1 2 Brangus cattle Comapny $17 9 14 22 5 28 (Click on the icon in order to copy its contents into a spreadsheet) 3 4 a. Calculate the annual rate of return for each year from the above information. b. What is the arithmetic average rate of return earned by investing in Brangus Cattle Company's stock over this period? a. The annual rate of return at the end of year 2 is % (Round to two decimal places)

(Calculating the geometric and arithmetic average rate of return) The common stock of the Brangus Cattle Company had the following end-of-year stock prices over the last five years and paid no cash dividends: Time 1 2 Brangus cattle Comapny $17 9 14 22 5 28 (Click on the icon in order to copy its contents into a spreadsheet) 3 4 a. Calculate the annual rate of return for each year from the above information. b. What is the arithmetic average rate of return earned by investing in Brangus Cattle Company's stock over this period? a. The annual rate of return at the end of year 2 is % (Round to two decimal places)

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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You invested in a beverage stock earlier this year; January 1, at the price of $42.50. Suppose at the end of the year; December 31, the price of the stock sells at $48.78. Determine the capital gain yield of the stock.
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The rates of return on Cherry Jalopies, Incorporated, stock over the last five years were 16 percent, 11 percent, −1 percent, 7 percent, and 10 percent. Over the same period, the returns on Straw Construction Company’s stock were 16 percent, 22 percent, −1 percent, 5 percent, and 12 percent. What was the arithmetic average return on each stock over this period? Note: Enter your answers as a percent rounded to 1 decimal place.
The rates of return on Cherry Jalopies, Inc., stock over the last five years were 14 percent, 11 percent, -3 percent, 2 percent, and 6 percent. Over the same period, the returns on Straw Construction Company's stock were 16 percent, 15 percent, -9 percent, 4 percent, and 11 percent. What was the arithmetic average return on each stock over this period? (Enter your answers as a percent rounded to 1 decimal place.) Cherry average return % Straw average return %
You bought a share of 6.8 percent preferred stock for $98.68 last year. The market price for your stock is now $103.92. What is your total return for last year? Assume a par value of $100. Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. Total return for last year %
1) John made the following investments in Stock A. Calculate his money-weighted return earned over the 5- year period. The cost of equity for Stock A is 10% p.a. Balance from previous year New investment by investor Net balance at beginning of year Investment return for the year Investment gains or (loss) Withdrawal by investor Balance at end of year 1 0 100 100 -50% -50 0 50 2 50 950 1000 35% 350 -350 1000 3 1000 0 1000 27% 270 0 1270 4 1270 230 1500 10% 150 -150 1500 5 1500 0 1500 20% 300 -1800 0
Suppose you purchase one share of the stock of Cereal Correlation Company at the beginning of year 1 for $35. At the end of year 1, you receive a $3 dividend, and buy one more share for $44. At the end of year 2, you receive total dividends of $6 (i.e., $3 for each share), and sell the shares for $50 each. The time-weighted return on your investment is? When performing the calculations, do not round any inputs or interim results until you get the final answer. Round your final answer to four places after the decimal point. The dollar-weighted return on your investment is? When performing the calculations, do not round any inputs or interim results until you get the final answer. Round your final answer to four places after the decimal point.
Using the data in the table to the right, calculate the return for investing in the stock from January 1 to December 31. Prices are after the dividend has been paid. (Click on the following icon in order to copy its contents into a spreadsheet.) Return for the entire period is %. (Round to two decimal places.) Date Jan 1 Feb 5 May 14 Aug 13 Nov 12 Dec 31 Price $33.88 $30.67 $29.49 $32.38 $39.07 $41.99 Dividend $0.17 $0.17 $0.17 $0.17
A compay expects earnings to be $3.18 next year, after earning $3.00 this year. With PEG ratio of 2.00x, the company's current stock price is closet to: A. $36.00 B. $38.16 C. $39.30 D. $40.45
(Calculating the geometric and arithmetic average rate of return) The common stock of the Brangus Cattle Company had the following end-of-year stock prices over the last five years and paid no cash dividends: Time 1 23WN Brangus cattle Comapny $16 8 11 21 5 29 (Click on the icon in order to copy its contents into a spreadsheet.) 4 a. Calculate the annual rate of return for each year from the above information. b. What is the arithmetic average rate of return earned by investing in Brangus Cattle Company's stock over this period? c. What is the geometric average rate of return earned by investing in Brangus Cattle Company's stock over this period? d. Which type of average rate of return best describes the average annual rate of return earned over the period (the arithmetic or geometric)? Why?
An investor bought a stock for $19 (at t=0) and one year later it paid a $0 dividend (at t=1). Just after the dividend was paid, the stock price was $5 (at t=1). Inflation over the past year (from t=0 to t=1) was 6% pa, given as an effective annual rate. Which of the following statements is NOTcorrect? All answer options are rounded to 6 decimal places. The stock investment produced a: Question 1Select one: a. Nominal capital return of -73.684211% pa. b. Nominal total return of -73.684211% pa. c. Real capital return of -72.105263% pa. d. Real income return of 0% pa. e. Real total return of -75.173783% pa.
Suppose you bought a stock for $27.1 per share and you sold it for $33.7 after 3 years. The stock did not pay any dividends. What was your compound average monthly return from this investment? Answer in percent, rounded to two decimal places.

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