Suppose the price per share of XYZ stock at the beginning of years 2005, 2006, 2007, 2008 is $100, $120, $90 and $99, respectively The stock pays a $3 dividend per share each year Suppose you buy 10 shares of XYZ at the beginning of 2005, buy another 5 shares at the beginning of 2006, sell 3 shares...

Year Price 2005 100 2006 120 2007 90 2008 99 Cost Price of shares 101005120A 1600 Sel ...

Suppose the price per share of XYZ stock at the beginning of years 2005, 2006, 2007, 2008

Question:

Suppose the price per share of XYZ stock at the beginning of years 2005, 2006, 2007, 2008 is $100, $120, $90 and $99, respectively. The stock pays a $3 per share each year. Suppose you buy 10 shares of XYZ at the beginning of 2005, buy another 5 shares at the beginning of 2006, sell 3 shares at the beginning of 2007, and sell all remaining shares at the beginning of 2008.
What are the arithmetic and geometric average time-weighted rates of return?
Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...