A the Beginning of 2012,you Pay $100 for a Share

question 2

Multiple Choice

A the beginning of 2012,you pay $100 for a share of stock that then pays you a dividend of $1 at the beginning of 2013.If the stock price rises from $100 to $109 per share over the year,then you have earned an annual rate of return of

• A)5 percent.
• B)1 percent.
• C)9 percent.
• D)4 percent.
• E)10 percent.

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Definitions:

Cost of Merchandise

The total expense incurred by a business to buy or produce the goods it has sold during a specific period.

Credit Memo

A Credit Memo is a document issued by a seller to a buyer, reducing the amount that the buyer owes to the seller, typically due to a return or an overpayment.

Perpetual Inventory

A system for managing inventory that instantly logs inventory sales or purchases via computerized point-of-sale systems and software for enterprise asset management.

Freight

The charge paid for transport of goods, typically either by land, sea, or air.