Suppose you purchase one share of the stock of Red Devil Corporation at the beginning of year 1 for $43.00. At the end of year 1. you receive a dividend of $2, and buy one more share for $47.00. At the end of year 2, you receive total dividends of $4 (e. $2 for each share), and sell the shares for $55.00 each. What is the time-weighted return on your investment? (Round your answer to 2 decimal places. Do not round intermediate calculations) Return IN

Suppose you purchase one share of the stock of Red Devil Corporation at the beginning of year 1 for $43.00. At the end of year 1. you receive a dividend of $2, and buy one more share for $47.00. At the end of year 2, you receive total dividends of $4 (e. $2 for each share), and sell the shares for $55.00 each. What is the time-weighted return on your investment? (Round your answer to 2 decimal places. Do not round intermediate calculations) Return IN

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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Similar questions

A stock costs $80 and pays a $2 annual dividend. If you expect to sell the stock after four years for $95, what is your anticipated return on the investment? Use Appendix B and Appendix D to answer the question. Round your answer to the nearest whole number. %
Your client buys 10 shares of stock at time 0 for $43 per share. At time 1, he receives a dividend of $1 per share, and buys another 10 shares at the new price of $48 per share. At time 2, he receives a dividend of $1 per share, and sells his entire holding of stock for $51 per share. What was the client's time-weighted annual return on this position? Enter answer as a percentage, accurate to two decimal places.
You purchase 100 shares of stock for $40 a share. The stock pays a $2 per share dividend at year-end. What is the rate of return on your investment if the year-end stock prices turn out to be $38, $40, and $42? What is your real (inflation-adjusted) rate of return in each case, assuming an inflation rate of 3%? Show all of your working. Do no use Excel.
Assume you buy 200 shares of stock at $70 per share on margin (40 percent). a. If the price risesto $95 per share, what is your percentage gain on the initial equity? b. What would the percentageloss on the initial equity be if the price had decreased to $40 ?
You invest $5,062 in stock and receive $68, $75, $93, and $95 in dividends over the following 4 years. At the end of the 4 years, you sell the stock for $7,200. What was the IRR on this investment? The IRR on this investment is %. (Round to the nearest whole percent.)
Assume that an investor buys 100 shares of stock at $37 per share, putting up a 65% margin. a. What is the debit balance in this transaction? b. How much equity funds must the investor provide to make this margin transaction? c. If the stock rises to $59 per share, what is the investor's new margin position? a. The debit balance in this transaction is $ *** (Round to the nearest dollar.)
Suppose you purchased a stock a year ago. Today, you receive a dividend of $12 and you sell the stock for $111. If your return was 8%, at what price did you buy the stock?
Explain well all point of question with proper answer.
Compute the price of a share of stock that pays a 2 per year dividend and that you expect to be able to sell in one year for 25, assuming you require a 10% return.
Suppose the call money rate is 4.5 percent, and you pay a spread of 2.5 percent over that. You buy 800 shares of stock at $36 per share. You put up $14, 400. One year later, the stock is selling for $48 per share and you close out your position. What is your return assuming a dividend of $0.65 per share is paid?
You decided to invest $10,000 of your savings in a stock whose current price is $25 per share. To utilize the benefit of margin investing, you borrowed an additional $10,000 from your broker and invested $20,000 in the stock, If the maintenance margin is 30 pereent, at what price will you receive your first margin call?
If an investor buys shares in a closed-end investment company for $46 and the net asset value is $53, what is the discount? If the company distributes $1, the net asset value rises to $58, and the investor sells the shares for a premium of 5 percent over the net asset value, what is the percentage earned on the investment?

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