QuestionAugust 4, 2025

One year ago, you purchased a stock at a price of 30.44 a share. Today, you sold the stock and realized a total loss of 2.35 percent on your investment. Your dividend income was - 3.57 a share. What was your capital gains yield? 6.57% 9.38% 11.19% -8.27% -7.57%

One year ago, you purchased a stock at a price of 30.44 a share. Today, you sold the stock and realized a total loss of 2.35 percent on your investment. Your dividend income was - 3.57 a share. What was your capital gains yield? 6.57% 9.38% 11.19% -8.27% -7.57%
One year ago, you purchased a stock at a price of 30.44 a share. Today, you sold the stock and realized a total loss of 2.35 percent on your investment. Your dividend income was - 3.57 a share. What was your capital gains yield? 6.57% 9.38% 11.19% -8.27% -7.57%

Solution
4.7(246 votes)

Answer

9.38\% Explanation 1. Calculate Total Loss Total loss is 2.35% of the initial price: 0.0235 \times 30.44 = 0.71534. 2. Determine Selling Price Selling price per share = Initial price - Total loss = 30.44 - 0.71534 = 29.72466. 3. Calculate Capital Gains Yield Capital gains yield = \frac{\text{Selling price} - \text{Initial price} + \text{Dividend income}}{\text{Initial price}} \times 100\%. Substitute values: \frac{29.72466 - 30.44 + 3.57}{30.44} \times 100\% = \frac{2.85466}{30.44} \times 100\% = 9.38\%.

Explanation

1. Calculate Total Loss<br /> Total loss is 2.35% of the initial price: $0.0235 \times 30.44 = 0.71534$.<br /><br />2. Determine Selling Price<br /> Selling price per share = Initial price - Total loss = $30.44 - 0.71534 = 29.72466$.<br /><br />3. Calculate Capital Gains Yield<br /> Capital gains yield = $\frac{\text{Selling price} - \text{Initial price} + \text{Dividend income}}{\text{Initial price}} \times 100\%$.<br /> Substitute values: $\frac{29.72466 - 30.44 + 3.57}{30.44} \times 100\% = \frac{2.85466}{30.44} \times 100\% = 9.38\%$.
Click to rate:

Similar Questions