In 1970, Wal-Mart offered 300,000 shares of itscommon stock to the public at a price of $16.50 pershare. Since that time, Wal-Mart has had 11 twofor-one stock splits. On a purchase of 100 shares at$16.50 per share on the company’s first offering,the number of shares has grown to 204,800 sharesworth $15,767,500 in July 2014. What is the returnon investment for investors who purchased the stockin 1970 (over a 44-year ownership period)? Assumethat no dividends were received during that period

In 1970, Wal-Mart offered 300,000 shares of itscommon stock to the public at a price of $16.50 pershare. Since that time, Wal-Mart has had 11 twofor-one stock splits. On a purchase of 100 shares at$16.50 per share on the company’s first offering,the number of shares has grown to 204,800 sharesworth $15,767,500 in July 2014. What is the returnon investment for investors who purchased the stockin 1970 (over a 44-year ownership period)? Assumethat no dividends were received during that period

Financial Accounting

14th Edition

ISBN:9781305088436

Author:Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:Carl Warren, Jim Reeve, Jonathan Duchac

Chapter13: Corporations: Organization, Stock Transactions, And Dividends

Section: Chapter Questions

Problem 4CP

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On October 1, 1970, Walmart first offered 300,000 shares of its common stock to the public at a price of $16.50 per share. Since that time, Walmart has had 11 two-for-one stock splits. So if you pur chased 100 shares in 1970, you would have 204,800 shares as of September 30, 2014. The closing price of the stock on that day was $77.50. What is the com pound growth of the Walmart stock over 44 years?
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