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Naddika [18.5K]
3 years ago
8

One year ago, you purchased 500 shares of stock for $22 a share. The stock pays $0.32 a share in dividends each year. Today, you

sold your shares for $24.50 a share. What is your total dollar return on this investment
Business
1 answer:
Vadim26 [7]3 years ago
3 0

Answer:

Return on investment=12.81%

Explanation:

<em>Return on investment for a stock comprises of the capitals and dividend earned on the stock.</em>

<em>The capital gain is the difference between he cost of the shares when it was bought and the value when it is sold.</em>

Capital gain = (24.50 -22)× 500= 1250

Dividend earned for a year = 0.32× 500 =160

Total return = 1250  + 160 =1,410

Total return = $1,410

Cost of the shares= 11,000

Return on investment = total return/cost of shares× 100

                                     =1,410 /11,000 ×  100= 12.81

Return on investment=12.81%

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