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Bavarian Sausage 2 You Bought a Share of Bavarian Sausage Stock for $46.50

Question 16

Multiple Choice

Bavarian Sausage 2
You bought a share of Bavarian Sausage stock for $46.50 at the beginning of the year. During the year the stock paid a $2.75 dividend and at the end of the year it trades at $44.75.
-If the return on your common stock investment is on average 18% and the return on Treasury bills was 5% over the same period of time,what is the risk premium that you earned.


A) 23%
B) 13%
C) 18%
D) 5%

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