The Busy Bee Corporation had a share price at the start of the year of $25.18, paid a dividend of $0.62 at the end of the year, and had a share price of $27.91 at the end of the year. Which of the following is closest to the rate of return of investments in companies with equal risk to Busy Bee Corporation for this period?

Question

Quizplus · Accepted Answer

The rate of return can be calculated by adding the dividend received to the change in share price, then dividing by the initial share price, and finally multiplying by 100 to get a percentage. For Busy Bee Corporation, this is (($0.62 + ($27.91 - $25.18)) / $25.18) * 100 = (($0.62 + $2.73) / $25.18) * 100 ≈ 13.3%, which is closest to 13%.

The Busy Bee Corporation Had a Share Price at the Start