Suppose a stock had an initial price of $87 per share, paid a dividend of $1.60

Question

Suppose a stock had an initial price of $87 per share, paid a dividend of $1.60 per share during the year, and had an ending share price of $102.

Compute the percentage total return. (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

What was the dividend yield? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

What was the capital gains yield? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

Suppose a stock had an initial price of $87 per share, paid a dividend of $1.60 per share during the year, and had an ending share price of $102.

Explanation / Answer

Initial Price            87.00 Ending Price          102.00 Increase in price(102-87)            15.00 Dividend              1.60 Total return = Inc+div            16.60 Return in % = 16.60 /87 = 19.08% Dividend Yield = Dividend/Price Dividend Yield = 1.60/102 = 1.57% Capital Gain Yield = (102-87)/87 Capital Gain Yield = 17.24%

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