Which of the following investment options is the most profitable in percentage terms?
A)A government bond with a coupon payment of $10,purchased at $100 and sold at $90 after a year
B)A government bond with a coupon payment of $15,purchased at $175,and sold at $155 after a year
C)A share with a dividend payment of $5,purchased at $50,and sold at $60 after a year
D)A treasury bill purchased at $160 and sold at $175 after a year

Question

Quizplus · Accepted Answer

To calculate the percentage return on investment, we use the formula:
Percentage return = ((selling price - buying price)/buying price) * 100

For option A: Percentage return = ((90 - 100)/100) * 100 = -10%
For option B: Percentage return = ((155 - 175)/175) * 100 = -11.43%
For option C: Percentage return = ((60+5-50)/50) * 100 = 30%
For option D: Percentage return = ((175 - 160)/160) * 100 = 9.375%

Therefore, the option with the highest percentage return is C, which is the share with a dividend payment of $5, purchased at $50, and sold at $60 after a year.

Which of the Following Investment Options Is the Most Profitable