One year ago, Debra purchased 5,400 shares of KNF stock for $218,056. Today, she sold those shares for $19.49 a share. What is the capital gains yield on this investment if the dividend yield is 1.7 percent?
A.-28.01 percent
B.-48.28 percent
C.3.07 percent
D.-51.73 percent
E.4.53 percent

Question

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Respuesta :

aristeus aristeus · Answer 1 · 2019-12-03T12:01:09+01:00

Answer:

Capital gain yield will be -51.73%

So option (d) will be the correct answer

Explanation:

We have given that Debra purchased 4500 shares of KNF stock for $218056

So price of one share [tex]=\frac{218056}{5400}=$48.380[/tex]

So the beginning price = $40.380

She sold the share at price of 19.49 per share

So ending price = $19.49

We have to find the capital gain yield

We know that capital gain yield is given by

Capital gain yield [tex]=\frac{end\ price-beginning\ price}{begninning \ price}=\frac{19.49-40.380}{40.390}=-51.73[/tex] %

So option (d) will be correct option