Interview Question Regarding Stock Return
Hey, not sure if this is the right section to post this question in, but worth a shot. I got an interesting interview question recently and was just wondering if my answer was right.
Question: If a $10 stock issues a $2 dividend, and then it appreciates 50% over the next year, what is your return?
My answer: After the $2 dividend, the stock price would drop to $8. Then a 50% appreciation would cause the price to be $12 next year. So your total return would be 40% (the $2 dividend, and $12 - $10 = $2 increase from the purchase price).
Hey Analyst 2 in CorpStrat, I'm here because nobody responded to this thread after a few days...maybe one of these resources will help you:
More suggestions...
Hope that helps.
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