Question 21 An investor purchases a share for $11 at the beginning of the year. At the end of Year 1, the stock pays a dividend of $0.75. At the beginning of the second year, the investor purchases another share of the same company for $10. At the end of the second year, the investor sells both shares for $12 each after receiving a $1 per share dividend. The money-weighted rate of return and the time- weighted rate of return are closest to: Money-Weighted Rate of Return Time-Weighted Rate of Return A. 101.43% 12.7% B. 27.4% 13.3% C. 17.3% 12.7% O Row B O Row A O Row C

Question 21 An investor purchases a share for $11 at the beginning of the year. At the end of Year 1, the stock pays a dividend of $0.75. At the beginning of the second year, the investor purchases another share of the same company for $10. At the end of the second year, the investor sells both shares for $12 each after receiving a $1 per share dividend. The money-weighted rate of return and the time- weighted rate of return are closest to: Money-Weighted Rate of Return Time-Weighted Rate of Return A. 101.43% 12.7% B. 27.4% 13.3% C. 17.3% 12.7% O Row B O Row A O Row C

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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QUESTION 17 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 (.e. $1 for each share) and sell the shares for $67.20 each The time-weighted return (geometric) on your investment is O 10.06%. O 8.77%. 19.73%. 17.60%.
ou purchase 100 shares of stock for $50 a share. The stock pays a $2 per share dividend at year-end. a. What is the rate of return on your investment if the end-of-year stock price is (i) $48; (ii) $50; (iii) $54? (Leave no cells blank - be certain to enter "0" wherever required. Enter your answers as a whole percent.) Rate of Return 48 50 54 b. What is your real (inflation-adjusted) rate of return if the inflation rate is 3%? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. Negative amounts should be indicated by a minus sign.) Real rate of Return 48 50 54
Question 8 On 16th may 2021 you purchased some shares at a price of $78 per dollar a share and a year later you sold them for $92 a share. At the end of the year of purchase, you received a cash dividend of $2.5 a share. compute the holding period return on the share. show all the workings to justify your answer.
An investor purchases a share for £5.31 at the beginning of the year. Six months later, the investor receives a dividend of £0.03 (net of tax) and immediately sells the share for £5.53. Capital gains tax of 30% is paid on the difference between the sale and the purchase price. Calculate the net annual effective rate of return the investor obtains on the investment. 数字 % Enter a percentage correct to 2 decimal places
which one is correct? QUESTION 11 Exhibit 1.7 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S) You purchased 100 shares of GE common stock on January 1, for $29 a share. A year later you received $1.25 in dividends per share and you sold it for $28 a share. Refer to Exhibit 1.7. Calculate your holding period return (HPR) for this investment in GE stock. a. 0.9655 b. 1.0973 c. 1.0804 d. 1.0086 e. 1.0357
An investor buys one share of a stock at $85 at t= 0. He buys an additional share for $90 at t= 1. The stock pays a dividend of $5 per share at t = 1 and t = 2. The investor sells both the shares at t = 2 for $100 each. Which of the following is most likely the time weighted rate of return? A. 11.34%. B. 14.18%. C. 14.94%.
An investor purchases 300 shares of a stock at a price of $75 per share. During the year, the investor receives dividends of $2.34 per share and then sells all the shares at the end of the year at a price of $79.60 per share. Calculate the investor's: a. Income b. Capital gain c. Total dollar return
XYZ stock price and dividend history are as follows: Beginning-of- $ 104 Year 2018 Year Price 2019 2020 2021 115 90 105 Dividend Paid at Year-End $ 2 2 2 2 An investor buys three shares of XYZ at the beginning of 2018, buys another one shares at the beginning of 2019, sells one share at the beginning of 2020, and sells all three remaining shares at the beginning of 2021. Required: a. What are the arithmetic and geometric average time-weighted rates of return for the investor? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Arithmetic time-weighted average returns Geometric time-weighted average returns % % b-1. Prepare a chart of cash flows for the four dates corresponding to the turns of the year for January 1, 2018, to January 1, 2021. (Negative amounts should be indicated by a minus sign.) Date Cash Flow 01/01/2018 01/01/2019 01/01/2020 01/01/2021
Suppose you purchase one share of the stock of Red Devil Corporation at the beginning of year 1 for $46.50. At the end of year 1, you receive a dividend of $2, and buy one more share for $50.50. At the end of year 2, you receive total dividends of $4 (i.e., $2 for each share), and sell the shares for $58.50 each. What is the time-weighted return on your investment? (Round your answer to 2 decimal places. Do not round intermediate calculations.)
XYZ stock price and dividend history are as follows: Year Beginning-of-Year Price Dividend Paid at Year-End 2018 $ 110 $ 3 2019 113 3 2020 100 3 2021 105 3 An investor buys four shares of XYZ at the beginning of 2018, buys another two shares at the beginning of 2019, sells one share at the beginning of 2020, and sells all five remaining shares at the beginning of 2021. Required: a. What are the arithmetic and geometric average time-weighted rates of return for the investor? (Do not round intermediate calculations. Round your answers to 2 decimal places.) b-1. Prepare a chart of cash flows for the four dates corresponding to the turns of the year for January 1, 2018, to January 1, 2021. (Negative amounts should be indicated by a minus sign.) b-2. What is the dollar-weighted rate of return? (Hint: If your calculator cannot calculate internal rate of return, you will have to use a spreadsheet or trial and error.) (Negative value should be indicated by a minus…
XYZ stock price and dividend history are as follows: Dividend Paid at Year-End Year 2018 2019 2020 2021 Beginning-of- Year Price $ 120 129 115 120 An investor buys six shares of XYZ at the beginning of 2018, buys another two shares at the beginning of 2019, sells one share at the beginning of 2020, and sells all seven remaining shares at the beginning of 2021. Required: a. What are the arithmetic and geometric average time-weighted rates of return for the investor? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Arithmetic time-weighted average returns Geometric time-weighted average returns % [%
XYZ stock price and dividend history are as follows: Dividend Paid at Year-End $ 3 3 3 3 Year 2018 2019 2020 2021 Beginning-of- Year Price $ 120 145 115 120 An investor buys six shares of XYZ at the beginning of 2018, buys another two shares at the beginning of 2019, sells one share at the beginning of 2020, and sells all seven remaining shares at the beginning of 2021. Required: a. What are the arithmetic and geometric average time-weighted rates of return for the investor? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Arithmetic time-weighted average returns Geometric time-weighted average returns Date 01/01/2018 01/01/2019 01/01/2020 01/01/2021 b-1. Prepare a chart of cash flows for the four dates corresponding to the turns of the year for January 1, 2018, to January 1, 2021. (Negative amounts should be indicated by a minus sign.) % % Cash Flow

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