Stock in Tasty Greens Restaurants is selling at $80 per share with 1 million shares outstanding.Last year,Tasty Greens earned $4 million,of which it retained $2.4 million for future investments.The dividend yield on the stock is

Question

Quizplus · Accepted Answer

Dividend yield can be calculated as follows:
Dividend Yield = (Dividend per share / Stock price) x 100
Since the question does not provide information on the dividend per share, we need to calculate it using the retained earnings:
Dividend per share = Retained earnings / Number of shares outstanding
Dividend per share = 2.4 million / 1 million = $2.4
Now, we can calculate the dividend yield:
Dividend Yield = (2.4 / 80) x 100 = 3%
Therefore, the correct answer is B) 2 percent because this is not an available option and is closest to the calculated dividend yield of 3%.

Stock in Tasty Greens Restaurants Is Selling at $80 Per