You purchased a share of stock for $12.One year later, you received $0.25 as a dividend and sold the share for $12.92.What was your holding-period return?
A)9.75%
B)10.65%
C)11.75%
D)11.25%

Question

Quizplus · Accepted Answer

The holding-period return is calculated as follows:Holding-period return = (Dividend + Capital gain) / Initial investmentDividend = $0.25Capital gain = $12.92 - $12 = $0.92Initial investment = $12Holding-period return = ($0.25 + $0.92) / $12 = 0.0975 = 9.75%

You Purchased a Share of Stock for $12