quired: James K. Silber, an avid international investor, just sold a share of Néstle, a Swiss firm, for SF5,250. The share was bought for 4,680 a year ago. The exchange rate is SF2.00 per U.S. dollar now and was SF1.94 per dollar a year ago. Mr. Silber received SF136 cash dividend immediately before the share was sold. Suppose that Mr. Silber sold SF4,680, his principal investment amount, ward at the forward exchange rate of SF2.02 per dollar. How would this affect the dollar rate of return on this Swiss stock estment?

quired: James K. Silber, an avid international investor, just sold a share of Néstle, a Swiss firm, for SF5,250. The share was bought for 4,680 a year ago. The exchange rate is SF2.00 per U.S. dollar now and was SF1.94 per dollar a year ago. Mr. Silber received SF136 cash dividend immediately before the share was sold. Suppose that Mr. Silber sold SF4,680, his principal investment amount, ward at the forward exchange rate of SF2.02 per dollar. How would this affect the dollar rate of return on this Swiss stock estment?

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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Greg purchased 200 shares of XYZ stock at $90 per share 8 years ago. Today he told all 200 shares for $20,000. What was his average annual compound return on this investment (ignoring taxes and inflation)? (Please use and round to two decimals) a. 1.01 b. 1.46 c. 1.54 d. 1.33
Required: Mr. James K. Silber, an avid international investor, just sold a share of Nestlé, a Swiss firm, for SF5,050. The share was bought for SF4,300 a year ago. The exchange rate is SF1.60 per U.S. dollar now and was SF1.84 per dollar a year ago. Mr. Silber received SF150.00 as a cash dividend immediately before the share was sold. Compute the rate of return on this investment in terms of U.S. dollars. Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.
2) You bought 1500 shares of Microsoft one year ago for $120 per share. Microsoft paid a $2 (per-share) dividend last year. The current stock price is $105. a. What rate of return did you earn from your Microsoft investment? b. Ifinflation rate over the last year was 4%, what is your real rate of return? c. Rather than buying 1500 Microsoft shares a year ago, you instead sold them short. What is the rate of return from your Microsoft trade now? Focu MacBook Pro A
In you cash account, you buy 100 shares of XYZ Corporation at a price of $10 per share. Two months later, XYZ pays a dividend $0.21 per share. You sell all 100 shares of XYZ three months later at a price of $12 per share. If you wanted to lever up the returns of this trade, you could have executed it in your _____ account. A) cash B) margin C) brokerage D) bank
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In you cash account, you buy 100 shares of XYZ Corporation at a price of $10 per share. Two months later, XYZ pays a dividend $0.21 per share. You sell all 100 shares of XYZ three months later at a price of $12 per share. What is your capital gain on this trade?
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On the advice of your uncle, you purchased 10 shares of a well-established U.S.-based corporate stock for $21 per share. After 1 quarter, you received $0.25 per share dividends each quarter for 2 years. At that point, the stock price had gone down in a short-term recession, so you purchased 10 more shares at $18 per share. The stock continued to pay 25¢ a share on all 20 shares. After 3 years (12 quarters), you decided to sell the stock since it had increased in market value to $24 per share. Make the following assumptions: (a) no commissions for the purchase or sale of the stock, (b) no government taxes on the dividends, and (c) quarterly compounding of the rate of return. What is the effective interest rate per year?

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