Question: A financial adviser claims that a particular stock earned a
A financial adviser claims that a particular stock earned a total return of 10 percent last year. During the year the stock price rose from $30 to $32.50. What dividend did the stock pay?
Answer to relevant QuestionsThe table below shows annual returns on the pharmaceutical leader Merck and chip maker Advanced Micro Devices. The last column of the table shows the annual return that a portfolio invested 50% in Merck and 50% in AMD would ...What is the difference between assets expected return and its actual return? Why are expected returns so important to investors and managers? If a particular stock had no systematic risk, only un-systematic risk, what would be its expected return? What factors determine whether the annual ac-counting rate of return on a given project will be high or low in the early years of the investments life? In the latter years? In almost every example so far, firms must decide to invest in a project immediately or not at all. But suppose that a firm could invest in a project today or it could wait one year before investing. How could you use NPV ...
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