Sue purchased a stock for $45 a share, held it for one year, received a $2.34 dividend, and sold the stock for $46.45. The nominal rate of return did she earn will be 8.42%.
Nominal rate of return in that case is;
= (Selling price - Purchase price+ Dividends) / Purchase price
= (46.45 - 45 + 2.34) / 45
= 8.42%
A dividend is the distribution of a business enterprise's income to its shareholders and is determined through the organisation's board of directors. Dividends are frequently dispensed quarterly and may be paid out as coins or inside the form of reinvestment in extra stock.
A stock dividend is a fee to shareholders that includes additional stocks instead of coins. The distributions are paid in fractions in line with present proportion. as an instance, if a business enterprise troubles a inventory dividend of 5%, it's going to pay zero.05 stocks for each percentage owned with the aid of a shareholder.
A dividend is a distribution of profits by means of a employer to its shareholders. whilst a company earns a earnings or surplus, it could pay a part of the profit as a dividend to shareholders.
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