Assume that $$10,000$ was invested in the stock of General Medical Corporation with the intention

of selling after one year. The stock pays no dividends, so the entire return will be based on the

price of the stock when sold. The opportunity cost of capital on the stock is $10$ percent.

a$.$ To begin, assume that the stock sale nets $$11,500.$ What is the dollar return on the stock

investment? What is the rate of return?

b$.$ Assume that the stock price falls and the net is only $$9,500$ when the stock is sold. What is the

dollar return and rate of return?

c$.$ Assume that the stock is held for two years. Now, what is the dollar return and rate of return?

Hint:Dollar amount is NPV and Rate of return is IRR