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17 October, 06:47

One year ago, you purchased 600 shares of a stock. This morning you sold those shares and realized a total return of 3.1 percent. Given this information, you know for sure the:

A. stock price increased by 3.1 percent over the last year.

B. stock increased in value over the past year.

C. stock paid a dividend.

D. dividend yield is greater than zero.

E. sum of the dividend yield and the capital gains yield is 3.1 percent.

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  1. 17 October, 10:47
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    E. sum of the dividend yield and the capital gains yield is 3.1 percent.

    Explanation:

    According to the scenario, computation of the given data are as follow:-

    As we know that,

    Total Return Price = (Dividend : Beginning year price) + Ending year price - Beginning year price

    = Dividend Yield + Capital Gains Yield

    So according to the analysis, option (E) sum of the dividends yield and the capital gains is 3.1 percent is correct.
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