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Suppose an Investor Buys a Share of Stock for $200

question 162

Essay

Suppose an investor buys a share of stock for $200 and sells it for $220 after one year. At the end of that year, the dividend per stock is $5. The company has 250,000 shares outstanding and a total profit for the year of $1,000,000. Calculate the rate of return on this stock for the investor.


Definitions:

Self-actualization

The act of achieving or fulfilling one's skills and potential, seen as a fundamental desire or requirement in everyone.

Self-fulfillment

The realization of one's dreams, aspirations, and potentials, making the most of one's talents and abilities.

Mastery

The comprehensive knowledge or skill in a subject or activity, often achieved through practice and learning.

Theory X

A management theory assuming that employees are inherently lazy and will avoid work if possible, necessitating control and coercion by management.

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