Question: Repeat the calculation but this time for year 2. Why are the returns so different? Current yield = $100 = 0.670 = 6.70% ____ $1495

  1. Repeat the calculation but this time for year 2. Why are the returns so different?

Current yield = $100 = 0.670 = 6.70%

____

$1495

CG yield = -$25 = -0.170 = -1.70%

_____

$1495

Total return = 6.7% - 1.7% = 5.0%

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