Question

You just bought 2,000 shares of JCI at $3.21 per share. This stock is not paying dividends. Your objective is to make an HPR of 4.8%. At what price per share will you achieve your goal?

{Enter your answer in dollars with 2 decimals, but do not use the "$".}

Answer 1

Holding Period Return Formula:

• HPR = ((Income/Dividend + (end of period value - original value/Purchase Price)) / original value/purchase price) * 100

Holding Period Return = 4.8%

Purchase Value per share = $3.21

Dividend income = 0

End of period value = X

4.8%(HPR) = 0(Dividend) + { X ( end of period value) - 3.21(Purchase Price)/3.21(Purchase price)

X = $ 3.364 per share

cross check:
HPR = 0(Dividend) + { 3.364 ( end of period value) - 3.21(Purchase Price)/3.21(Purchase price)

= .154/3.21

=4.8%