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Author Question: Gary bought a share of stock for 15.75 that paid a dividend of .45 and sold three months later for ... (Read 224 times)

torybrooks

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on: Jul 10, 2018
Gary bought a share of stock for 15.75 that paid a dividend of .45 and sold three months later for 18.65. What was his dollar profit or loss and holding period return?
 
  A) 2.90, 18.41
  B) 3.35, 21.27
  C) -2.90, -18.41
  D) .45, 2.86

Question 2

Assume that the financial markets are in equilibrium. Information on three particular stocks is provided in the table below. Find the risk free rate and the expected return on the market portfolio.
 
  Asset Expected Return Beta
  A 7.6 0.2
  B 12.4 0.8
  C 15.6 1.2
 
  A) 5, 14
  B) 5, 18
  C) 6, 14
  D) 6, 18
  E) 7, 16


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coyin

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Reply #1 on: Jul 10, 2018
Answer to Question 1

Answer: B
Explanation: B) Profit = Ending Value + Distributions - Original Cost
Profit = 18.65 + 0.45 - 15.75 = 3.35.
HPR = = = 21.27.

Answer to Question 2

C


torybrooks

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Reply 2 on: Jul 10, 2018
Great answer, keep it coming :)

bdobbins

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Reply 3 on: Yesterday
Wow, this really help

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