Purchased 100 shares of my airlines stock for $12 per share. The next year the stock paid a dividend of $1 per share. I buy 100 additional shares for $11 per share. At the end of the second year I sell all 200 shares for $20 per share. What was the weighted return on my airlines stock?
Purchased 100 shares of my airlines stock for $12 per share. The next year the stock paid a dividend of $1 per share. I buy 100 additional shares for $11 per share. At the end of the second year I sell all 200 shares for $20 per share. What was the weighted return on my airlines stock?
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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Purchased 100 shares of my airlines stock for $12 per share. The next year the stock paid a dividend of $1 per share. I buy 100 additional shares for $11 per share. At the end of the second year I sell all 200 shares for $20 per share. What was the weighted return on my airlines stock?
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Introduction
The formula for the total stock return is the appreciation in the price plus any dividends paid, divided by the original price of the stock. The income sources from a stock is dividends and its increase in value.
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