An Investor Buys Stock for $10,000 at the Beginning of the Year.She

question 58

Multiple Choice

An investor buys stock for $10,000 at the beginning of the year.She earns dividends of $300 during the course of the year.At the end of the year, the stock is worth $10,800.The tax rate on dividends and capital gains is 15 percent. The inflation rate is 3 percent.What is the investor's after tax real return if she sells the stock at the end of the year?

• A)6.35 percent.
• B)6.95 percent.
• C)7.55 percent.
• D)8.15 percent.