Last year, Damian Lillard paid $39.25 for shares of Gatorade. Afterwards, he received a dividend of $1.39 per share. What is Damian Lillard’s capital gains yield if, at the end of the year, Gatorade shares closed at $44.65? a. 13.76% b. 12.09% c. 17.30% d. 3.54% e. 11.49%

Last year, Damian Lillard paid $39.25 for shares of Gatorade. Afterwards, he received a dividend of $1.39 per share. What is Damian Lillard’s capital gains yield if, at the end of the year, Gatorade shares closed at $44.65? a. 13.76% b. 12.09% c. 17.30% d. 3.54% e. 11.49%

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter7: Stocks (equity) - Characterstics And Valuation

Section: Chapter Questions

Problem 2PROB

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Concept explainers

Stockholder's Equity

The stockholders’ equity (often referred to as the book value of the company) is the number of assets available to the stockholder after its entire liabilities is paid off. The stockholders’ equity is also sometimes referred to as owner's equity. The stockholders’ equity or book value generally includes common stock, treasury stock retained earnings. It is an indicator of a company's financial strength and is an important item on the company's balance sheet.

Question

a. 13.76%

b. 12.09%

c. 17.30%

d. 3.54%

e. 11.49%

Definition Definition Increase in the value of a capital asset and the amount that is realized when the asset is sold off. A capital gain may be short-term or long-term depending on the tenure for which the asset is held.

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