Question

Suppose you purchase one share of the stock of Cereal Correlation Company at the beginning of year 1 for $50. At the end of year 1, you receive a $1 dividend and buy one more share for $72. At the end of year 2, you receive total dividends of $2 (i.e., $1 for each share) and sell the shares for $67.20 each. The time-weighted return on your investment is
a. 8.7%.
b. 17.6%.
c. 10.0%.
d. 19.7%.

Answer 1

B the answer is going to be