Simple annual return and compounded annual return

Assignment Help Financial Management
Reference no: EM131336220

Part A) You purchased a share of stock for $87.45 twelve years ago and just sold it today for $115.83. No dividends were paid out over the twelve years but you did receive an accumulated dividend of $35.70 when you sold the stock. What is your (a) Dollar gain or loss; and (b) HPR?

A. $28.38; 24.5%

B. $64.08; 73.3%

C. $64.08; 55.3%

D. $203.28; 23.2%

Part B) You purchased a share of stock for $87.45 twelve years ago and just sold it today for $115.83. No dividends were paid out over the twelve years but you did receive an accumulated dividend of $35.70 when you sold the stock. What is your (a) Simple Annual Return; and Compounded Annual Return?

A. 4.7%; 6.1%

B. 5.8%; 3.4%

C. 3.4%; 5.8%

D. 6.1%; 4.7%

Reference no: EM131336220

Questions Cloud

Write an introduction with a thesis : Analyze its history from 1877 to the present.  Write an introduction with a thesis. Your thesis should summarize the main conclusions that you discovered while researching your topic and that you will support with a logical argument based on evidence..
Hedge the risk of portfolio by short-selling treasury bonds : A manager is holding a $1.4 million bond portfolio with a modified duration of 7 years. She would like to hedge the risk of the portfolio by short-selling Treasury bonds. The modified duration of T-bonds is 8 years. How many dollars' worth of T-bonds..
Depreciation deductions cannot be taken on leased equipment : You have the option to purchase or lease a? five-axis horizontal machining center. Any revenues generated from the operation of the machine will be the same whether it is leased or purchased. Under the Lease? Option, maintenance costs are included in..
Dollar gain or loss and hpr : You bought a stock for $37.80 and sold it 7 months later for $40.18 with no dividends paid. What is your (a) Dollar gain or loss; and (b) HPR? You bought a stock for $37.80 and sold it 7 months later for $40.18 with no dividends paid. What is your (a..
Simple annual return and compounded annual return : You purchased a share of stock for $87.45 twelve years ago and just sold it today for $115.83. No dividends were paid out over the twelve years but you did receive an accumulated dividend of $35.70 when you sold the stock. What is your (a) Simple Ann..
Manufactures large variety of products : What a Beatiful Day Manufacturing manufactures a large variety of products. Unfortunately for the company, its sales dramatically decreased in the last two years. Due to this event, the CFO of the company decided to sell the company's Mercedez Benz a..
What is the company target debt–equity ratio : Fama’s Llamas has a WACC of 10.7 percent. The company’s cost of equity is 14 percent, and its pretax cost of debt is 8.5 percent. The tax rate is 35 percent. What is the company’s target debt–equity ratio?
How one of the five core topics is demonstrated in the movie : How one of the five core topics is demonstrated in the movie and The role that at least one type of relationship plays in the movie. This could include father/son, mother/son, friends, or romantic relationships
Two years after the bonds were issued : Alibaba Company Limited sold an issue of bonds with a 10-year maturity, a $1,000 par value, a 10 percent coupon rate, and semiannual interest payments. Two years after the bonds were issued, the going rate of interest on bonds such as these fell to 6..

Reviews

Write a Review

Financial Management Questions & Answers

  What is expected return on the market-risk-free rate

Suppose you observe the following situation: Security Beta. peat co=1.200 Expected Return =12 ., Re-Peat Co. Beta = .75 and Expected return=10.5 .Assume these securities are correctly priced. Based on the CAPM, what is the expected return on the mark..

  Discuss decision-making processes in creating budget

Discuss decision-making processes in creating a budget. Explain the role of variance analysis in maintaining an operating budget. Differentiate between managerial accounting and financial management. How your recommendation affects employee satisfact..

  Offering yield of adding call feature to proposed bond issue

Explain the impact on the offering yield of adding a call feature to a proposed bond issue. Explain the impact on the bond's expected life of adding a call feature to a proposed bond issue. Describe one advantage and one disadvantage of including cal..

  What constant rate is the stock expected to grow after year

Mitts Cosmetics Co.'s stock price is $60.31, and it recently paid a $2.50 dividend. This dividend is expected to grow by 24% for the next 3 years, then grow forever at a constant rate, g; and rs = 15%. At what constant rate is the stock expected to g..

  Projects with different lives

Projects with different lives: your firm is deciding whether to purchase a durable delivery vehicle or a short term vehicle. the durable vehicle cost $25,000 and should last 5 years. the short-term vehicle costs $ 10,000 and should last two years. if..

  How much in dividends were paid to shareholders

In its most recent financial statements, Newhouse Inc. reported $25 million of net income and $300 million of retained earnings. The previous retained earnings were $285 million. How much in dividends were paid to shareholders during the year? Assume..

  What will be amount to be paid each month during six years

To finance his development, Innovplastic ltd is negotiating a loan from the bank. The amount needed is 3000 000 €. The bank proposes an interest rate of 6% (insurance included). The loan will be reimbursed by fix payment each month. You are consideri..

  How much interest will you earn over the life of the loan

You are lending your friend $25,000. She agrees to repay the loan in equal quarterly payments over a three-year period at an interest rate of 8% compounded quarterly. How much interest will you earn over the life of the loan?

  What was the firms net income

During the year, the Senbet Discount Tire Company had gross sales of $1.08 million. The firm’s cost of goods sold and selling expenses were $527,000 and $217,000, respectively. The firm also had notes payable of $820,000. What was the firm’s net inco..

  Determine end of coming year level of accounts receivable

In the past a company's collection period has been 45 days. Using the percentage of sales method, determine the end of coming year level of accounts receivable that accompany the following sales levels if accounts receive able were a spontaneous asse..

  What are the current carrying costs and order costs

Louise Manufacturing uses 3,400 switch assemblies per week and then reorders another 3,400. The relevant carrying cost per switch assembly is $14.50, and the fixed order cost is $1,700. What are the current carrying costs? What are the order costs?

  What is expected annual rate of return from buying today

A stock you are buying today promises no dividends for a long time. In exactly 5 years the stock will pay its first dividend of $2.30. At that time you also believe the stock could be sold for $43.00. If today you can buy the stock for $28.95, what i..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd