The common shares of the Chevrotin Ltd have a book value of $43.20 and a market value of $57.20 The company pays $0.56 in dividends each quarter. What is the dividend yield?

Question

Quizplus · Accepted Answer

The dividend yield is calculated by dividing the annual dividend by the market price per share. The annual dividend is $0.56 per quarter * 4 quarters = $2.24. Dividing this by the market value of $57.20 gives a dividend yield of 3.9% ($2.24 / $57.20 = 0.0391 or 3.9%).

The Common Shares of the Chevrotin Ltd Have a Book