Which one of the following statements is correct concerning the dividend yield and the total return?
A)The dividend yield can be zero while the total return must be a positive value.
B)The total return can be negative but the dividend yield cannot be negative.
C)The total return must be greater than the dividend yield.
D)The total return plus the capital gains yield is equal to the dividend yield.
E)The dividend yield exceeds the total return when a stock increases in value.

Question

Quizplus · Accepted Answer

The total return, which includes dividends, interest, and capital gains, can indeed be negative if the loss on the investment exceeds the income received. However, the dividend yield, which is the dividend per share divided by the price per share, cannot be negative because dividends cannot be negative.

Which One of the Following Statements Is Correct Concerning the Dividend