An investor bought a stock for $19 (at t=0) and one year later it paid a $0 dividend (at t=1). Just after the dividend was paid, the stock price was $5 (at t=1). Inflation over the past year (from t=0 to t=1) was 6% pa, given as an effective annual rate. Which of the following statements is NOTcorrect? All answer options are rounded to 6 decimal places. The stock investment produced a: Question 1Select one: a. Nominal capital return of -73.684211% pa. b. Nominal total return of -73.684211% pa. c. Real capital return of -72.105263% pa. d. Real income return of 0% pa. e. Real total return of -75.173783% pa.
An investor bought a stock for $19 (at t=0) and one year later it paid a $0 dividend (at t=1). Just after the dividend was paid, the stock price was $5 (at t=1). Inflation over the past year (from t=0 to t=1) was 6% pa, given as an effective annual rate. Which of the following statements is NOTcorrect? All answer options are rounded to 6 decimal places. The stock investment produced a: Question 1Select one: a. Nominal capital return of -73.684211% pa. b. Nominal total return of -73.684211% pa. c. Real capital return of -72.105263% pa. d. Real income return of 0% pa. e. Real total return of -75.173783% pa.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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An investor bought a stock for $19 (at t=0) and one year later it paid a $0 dividend (at t=1). Just after the dividend was paid, the stock price was $5 (at t=1). Inflation over the past year (from t=0 to t=1) was 6% pa, given as an effective annual rate. Which of the following statements is NOTcorrect? All answer options are rounded to 6 decimal places. The stock investment produced a:
Question 1Select one:
a.
Nominal capital return of -73.684211% pa.
b.
Nominal total return of -73.684211% pa.
c.
Real capital return of -72.105263% pa.
d.
Real income return of 0% pa.
e.
Real total return of -75.173783% pa.
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