Suppose You Buy a Stock That Sells for $20

question 94

Short Answer

Suppose you buy a stock that sells for $20.It's expected annual dividend is $2 and you expect its price to be $25 in one year.What is your expected rate of return on the stock?

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Definitions:

Accrued Fees

Fees earned but not yet received in cash or recorded by the recipient, representing amounts for services provided.

Reversing Entry

An accounting entry that counteracts an adjusting entry, made at the beginning of the next accounting period.

Accounts Receivable

Funds that customers owe to a company for products or services that have already been provided but not yet compensated for.

Fees Earned

Revenue recognized by a company or individual in exchange for services rendered.