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21 April, 13:43

You bought a share of Bavarian Sausage stock for $46.50 at the beginning of the year. During the year the stock paid a $2.75 dividend and at the end of the year it trades at $52.75. What is the total return of your stock investment? (Show your work. Label %. Two decimal places required. Highlight or bold your answer.) What is the total dollar return on your investment?

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  1. 21 April, 14:10
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    0.1935; 9

    Explanation:

    (a) Total return of your stock investment:

    = (Trading value of stock at the year end + Dividend paid - Cost of purchasing the stock) : Cost of purchasing the stock

    = (52.75 + 2.75 - 46.5) : 46.5

    = 0.1935

    (b) Total dollar return on your investment:

    = Trading value of stock at the year end + Dividend paid - Cost of purchasing the stock

    = 52.75 + 2.75 - 46.50

    = 9
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