Emily Myers purchased a share of company X at $700 one year ago and earned a dividend of $50 during the year. The share is trading now at $850. Calculate Emily's return from investment if she sells her share at $850.
A) 7.14%
B) 21.43%
C) 28.57%
D) 14.29%

Question

Quizplus · Accepted Answer

Emily's total return from the investment is calculated as the sum of capital gain (increase in share price) and the dividend earned during the year. Therefore, Emily's total return is ($850 - $700)/$700 + $50/$700 = 0.2857 or 28.57%, which is choice C.

Emily Myers Purchased a Share of Company X at $700