If a Share Pays Dividends at the End of Each

question 14

Multiple Choice

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

• A)R_annual = R₁ + R₂ + R₃ + R_4.
• B)R_annual = (1 + R₁)(1 + R₂)(1 + R₃)(1 + R₄)- 1.
• C)R_annual =.
• D)R_annual = (1 + R₁)(1 + R₂)(1 + R₃)(1 + R₄).