You purchased 500 shares of a stock at a price of $22.50 per share. One year later, the shares sold for $21 each. At that end of the year, a $1.50 per share dividend was paid. What is the dividend yield for the investment?

A) -7.1%
B) -6.7%
C) 0.0%
D) 6.7%
E) 7.1%

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Katie Mitchell · Accepted Answer

Final Answer : D, Explanation :  The dividend yield is calculated as the annual dividends per share divided by the price per share. Here, the dividend is $1.50 per share. The price per share at the time of purchase was $22.50. Thus, the dividend yield = ($1.50 / $22.50) * 100% = 6.7%.

You purchased 500 shares of a stock at a price of $22.50 per share. One year later, the shares sold for $21 each. At that end of the year, a $1.50 per share dividend was paid. What is the dividend yield for the investment?

A) -7.1%
B) -6.7%
C) 0.0%
D) 6.7%
E) 7.1%

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You purchased 500 shares of a stock at a price of $22.50 per share. One year later, the shares sold for $21 each. At that end of the year, a $1.50 per share dividend was paid. What is the dividend yield for the investment?A) -7.1%B) -6.7%C) 0.0%D) 6.7%E) 7.1%

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Learning Objectives

Learning Objectives

Related questions

You purchased 500 shares of a stock at a price of $22.50 per share. One year later, the shares sold for $21 each. At that end of the year, a $1.50 per share dividend was paid. What is the dividend yield for the investment?

A) -7.1%
B) -6.7%
C) 0.0%
D) 6.7%
E) 7.1%