You purchased a share of stock for $58.00. At the end of a quarter, the stock paid a dividend of $0.75, and you sold it for $63.00 right after receiving the dividend.
-Refer to the information above. What was your total rate of return on this investment? Round your answer to the nearest tenth of a percent.
A)8.6%
B)7.2%
C)10.9%
D)9.9%

Question

Quizplus · Accepted Answer

We can calculate the total rate of return using the formula:
Total Rate of Return = (Dividend + Ending Price - Beginning Price) / Beginning Price

Plugging in the numbers, we get:
Total Rate of Return = (0.75 + 63 - 58) / 58
Total Rate of Return = 5.75 / 58
Total Rate of Return = 0.0991 or 9.9%

Therefore, the answer is D) 9.9%.

You Purchased a Share of Stock for $58