One Year Ago, You Purchased 400 Shares of Southern Cotton

question 32

Multiple Choice

One year ago, you purchased 400 shares of Southern Cotton at $38.40 a share. During the past year, you received a total of $480 in dividends. Today, you sold your shares for $41.10 a share. What is your total return on this investment?

• A) 8.79 percent
• B) 9.64 percent
• C) 10.16 percent
• D) 11.64 percent
• E) 12.76 percent

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Definitions:

Margin

In finance, margin refers to the difference between the selling price and the cost of goods sold, often expressed as a percentage of the selling price. In trading, it refers to the collateral required to open and maintain a position.

Cost

The amount of money required to purchase something or the expense incurred to create a product or service.

Overhead Costs

Expenses related to the day-to-day running of a business that are not directly linked to the production of goods or services.

Operating Profit

The income generated from the main activities of a company, not including interest and tax expenses.