Question

Sprint Nextel Corp stock ended the previous year at $25.00 per share. It paid a $2.57 per share dividend last year. It ended last year at $18.89. If you owned 650 shares of Sprint, what was your dollar return and percent return? A. $2,960; 11.13%B. -$4,960; -16.13%C. -$3,960; -15.13%D.-$2,301; -14.16%

Answer 1

Answer:

D.-$2,301; -14.16%

Explanation:

Answer:

Explanation:

Earnings per share is the profit that a business makes per outstanding shares of the company. Outstanding shares are all shares that have been issued by a company and on which they have obligation to pay dividends.

The value of 650 shares of Sprint Nextel corp= 650*25= $16,250

Rate of return on Sprint Nextel shares= {(Ending price of shares- Beginning price of shares)+ Dividend}/Beginning price of shares

Rate of return on Sprint Nextel shares= {(18.89-25)+2.57}/25

Rate of return on Sprint Nextel shares= -0.1416

Dollar return on Sprint Nextel shares= Rate of return * Purchase price* Number of shares

Dollar return on Sprint Nextel shares= -0.1416* 25* 650= -$2,301

The percentage return= (Dollar return/Initial Total value of shares)* 100

Percentage return= (-2,301/16,250)*100 = -14.16%