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6 January, 16:16

A stock is bought for $23.00 and sold for $27.00 one year later, immediately after it has paid a dividend of $1.50. what is the capital gain rate for this transaction

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  1. 6 January, 16:20
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    P1 = $27

    P0 = $23

    To solve:

    Capital gain rate = (P1 - P0) / P0

    Capital gain rate = ($27.00 - $23.00) / $23.00

    Capital gain rate = $4/$23

    Capital gain rate = 0.1739

    Capital gain rate = (0.1739) (100)

    Capital gain rate = 17.39%
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