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zimovet [89]
3 years ago
14

Eight months ago, you purchased 400 shares of Winston, Inc. stock at a price of $54.90 a share. The company pays quarterly divid

ends of $.50 a share. You have received dividends twice. Today, you sold all of your shares for $49.30 a share. What is your total percentage return on this investment? a. -10.2 percent b. -9.3 percent c. -8.4 percent d. 12.0 percent e. 13.4 percent
Business
1 answer:
DIA [1.3K]3 years ago
6 0

Answer:

c)    - 8.4%

Explanation:

<em>The return on a stock is the sum of the capital gains(loss) plus the dividends earne</em>d.

<em>Capital gain is the difference between he value of the stocks when sold and the cost of the shares when purchased.</em>

<em>Total shareholders Return = </em>

<em>(Capital gain/ loss + dividend )/purchase price  ×  100</em>

So we can apply this to the formula:

<em>Dividend</em> = $0.5 × 2 = $1

<em>Capital loss</em> = $49.30 - 54.90

% return =( $1 + ($49.30 - 54.90))/54.90

=-8.4%

Total percentage return on this investment = -8.4%

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