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?

Question

Quizplus · Accepted Answer

First, we need to find the total selling price of the shares:

$19.49/share x 5,400 shares = $105,246

Next, we need to determine how much Debra originally paid for the shares:

$218,056/5,400 shares = $40.38/share

Now we can calculate the total cost basis:

$40.38/share x 5,400 shares = $218,056

We also need to calculate the total dividends earned:

1.7% x $218,056 = $3,710.95

Now we can calculate the capital gains yield:

Capital Gains Yield = (Total Selling Price - Total Cost Basis - Total Dividends) / Total Cost Basis

= ($105,246 - $218,056 - $3,710.95) / $218,056

= -$117,520.95 / $218,056

= -0.538 or -53.8%

Therefore, the closest answer is D, -51.73%.

One Year Ago,Debra Purchased 5,400 Shares of KNF Stock for $218,056.Today,she