A Stock Is Held One Year, During Which Time Its

question 64

Multiple Choice

A stock is held one year, during which time its dividend yield was greater than its capital gains yield.For this stock, the percentage return:

• A)Is positive
• B)Is negative
• C)Equals the dividend yield
• D)Cannot be determined

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Definitions:

Required Rate

The minimum acceptable return on an investment or project, often used in capital budgeting.

Annuity

A fiscal instrument that provides a consistent flow of income to a person, often employed as a revenue source for those in retirement.

Internal Rate

A term often not complete on its own, likely referring to "Internal Rate of Return (IRR)," which is the discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero.

Present Value Tables

A set of tables that provide the factor needed to calculate the present value of a single payment or series of payments to be received in the future.