If a Stock Pays Dividends at the End of Each

question 97

Multiple Choice

If a stock pays dividends at the end of each quarter,with realized returns of R1,R2,R3,and R4 each quarter,then the annual realized return is calculated as:

• A)Rannual = .
• B)Rannual = (1 + R1)(1 + R2)(1 + R3)(1 + R4).
• C)Rannual = (1 + R1)(1 + R2)(1 + R3)(1 + R4)- 1.
• D)Rannual = R1 + R2 + R3 + R4.

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Definitions:

Marginal Analysis

An examination of the benefits and costs of certain activities or financial decisions.

Marginal Analysis

A technique used in economics to examine the benefits of adding one more unit of a good or service.

Marginal Cost

The cost incurred by producing one additional unit of a product or service.

Marginal Benefit

The additional satisfaction or utility gained by consuming an additional unit of a good or service.