If the price of a financial asset is $100 at the beginning of the period, $120 at the end of the period and a $5 dividend was paid, what was the percentage return?

Question

Quizplus · Accepted Answer

To calculate the percentage return, we need to consider both the capital gain (increase in price) and the dividend received. The capital gain is $20 ($120 - $100) and the dividend is $5, making a total gain of $25. To calculate the percentage return, we divide the total gain by the initial price and multiply by 100: ($25/$100) x 100 = 25%. Therefore, the correct answer is choice C.

If the Price of a Financial Asset Is $100 at the Beginning