Question

# Sarah purchased 100 shares of General Electric stock at a price of \$51.46 three months ago....

Sarah purchased 100 shares of General Electric stock at a price of \$51.46 three months ago. She sold all stocks today for \$56.12. During the year the stock paid dividends of \$2.90 per share. What is Sarah’s holding period return? Round the answers to two decimal places in percentage form.

 Solution: Holding period return (HPR) = 14.69% Working Notes: Holding period return (HPR) = (Selling price + Dividend per share - Purchase price per share)/Purchase price per share Holding period return (HPR) = (\$56.12 + \$2.90 -\$51.46)/\$51.46 Holding period return (HPR) = 7.56/51.46 Holding period return (HPR) = 0.14691022 Holding period return (HPR) = 14.691022% Holding period return (HPR) = 14.69% Notes: Rate of Returns for 100 shares will same as for 1 share Please feel free to ask if anything about above solution in comment section of the question.

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