Question

One of your clients purchased 100 shares of XYZ common stock at $30 per share and sells them one year later at $35 per share. Throughout the year, your client received a dividend of $1 per share. What is your client's total return on this investment

Answer 1

Answer: 20%

Explanation:

Return on investment = return/investment (cost)

Return = 3500 - 3000 = $500 + $100 dividend = $600

$30 x 100 = 3000

$35  x 100 shares = 3500

Cost = $30 x 100 shares =$3000

ROI = 600 / 3000 = 0.2

20%