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3 July, 08:05

Sue purchased a stock for $25 a share, held it for one year, received a $1.34 dividend, and sold the stock for $26.45. What nominal rate of return did she earn? 10.55% 14.23% 12.09% 11.16%

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  1. 3 July, 11:42
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    11.16%

    Explanation:

    Given that

    Purchase price of stock = $25

    Sale price of stock = $26.45

    Dividend = $1.34

    So, The computation of the nominal rate of return is shown below:

    Nominal rate of return = (Sale price of the stock - purchase price of the stock + Dividend) : (Purchase price of the stock)

    = ($26.45 - $25 + $1.34) : ($25)

    = 11.16%
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