what is the rate 10:00 AM ezto.mheducation.com ATL to FLL.. Bay Harbo. Sear....
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what is the rate 10:00 AM ezto.mheducation.com ATL to FLL.. Bay Harbo. Sear.... Resort | C...ATL to FLL. . Homework7 Home... Che E connect : MANAGERTAL FINANCE Week 7 Homework Question 3 (of S) y that connects 3 thers who wor... 10.00 points You purchase 100 shares of stock for $40 a share. The stock pays a $2 per share dividend at year -end stock prices listed below? What is your real What is the rate of return on your investment for the end-of year (inflationadjusted) rate of return? Assume an nason rate of 3%. (Leave no cells blank-be certain ! enter "0" wherever required. Negativ intermediate calculations. Round your "Real Rate o e values should be indicated by a minus sign. Do not round of Return" answers to 2 decimal places.) Rate of Retun Rate of a $38 b. $40 $46 eBook & Resources eBook Rates of Return: A ReviewExplanation / Answer
Answer:a Rate of return = (Dividend/Current market price)*100
=($2/$38)*100
=5.26%
Real rate of return = [(1+nominal rate of return)/(1+inflation rate)]-1
=[(1+0.0526)/(1+0.03)]-1
=2.194%
Answer:b Rate of return = (Dividend/Current market price)*100
=($2/$40)*100
=5%
Real rate of return = [(1+nominal rate of return)/(1+inflation rate)]-1
=[(1+0.05)/(1+0.03)]-1
=1.94%
Answer:c Rate of return = (Dividend/Current market price)*100
=($2/$46)*100
=4.35%
Real rate of return = [(1+nominal rate of return)/(1+inflation rate)]-1
=[(1+0.0435)/(1+0.03)]-1
=1.31%
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