An investment in 10,000 common shares of a company for one year earned a 15.5% return. The investor received a $2,500 dividend just prior to the sale of the shares at $24 per share. The price that the investor paid for each share one year earlier was closest to:
$20.80.
$20.50.
$21.00.
How we can solve this sum?
the dividend per share is 0.25 and he sold the shares at 24 and earned a return of 15.5%
so 115.5% =24,25
so 100%=20.99
ans should be c
TO MAKE IT A LITTLE MORE EASIER TO UNDERSTAND THAN WHAT ABHISHEK EXPLANED
YOU CAN DO IT BY FOLLOWING THE STEPS GIVEN BELOW
0.115(THAT IS 15.5%)=24.25-X/X
WE TOOK 24.25 INSTEAD OF 24 BECAUSE WE GOT A DIVIDEND OF 2500 WHICH COMES DOWN TO .25 / SHARE
AND