You are considering two investment alternatives. The first is a stock that pays quarterly dividends of $0.32 per share and is trading at $27.85 per share; you expect to sell the stock in six months for $31.72. The second is a stock that pays quarterly dividends of $0.67 per share and is trading at $34.98 per share; you expect to sell the stock in one year for $36.79. Which stock will provide the better annualized holding period return?The 1-year HPR for the second stock is%. The stock that will provide the better annualized holding period return is. A. Stock 1 B. Stock 2

The 1-year HPR for the second stock is 12.84%. The stock that will provide the better annualized holding period return is Stock 1.

Explanation:

For First stock

Total dividend from first stock = Dividend per share * Number quarters = $0.32 * 2 = $0.64

HPR of first stock = (Total dividend from first stock + (Selling price after six months - Initial selling price per share)) / Initial selling price = ($0.64 + ($31.72 - $27.85)) / $27.85 = 0.1619, or 16.19%

Annualized holding period return of first stock = HPR of first stock * Number 6 months in a year = 16.19% * 2 = 32.38%

For Second stock

Total dividend from second stock = Dividend per share * Number quarters = $0.67 * 4 = $2.68

Since you expect to sell the stock in one year, we have:

Annualized holding period return of second stock = The 1-year HPR for the second stock = (Total dividend from second stock + (Selling price after six months - Initial selling price per share)) / Initial selling price = ($2.68+ ($36.79 - $34.98)) / $34.98 = 0.1284, or 12.84%

Since the Annualized holding period return of first stock of 32.38% is higher than the Annualized holding period return of second stock of 12.84%. the first stock will provide the better annualized holding period return.

The 1-year HPR for the second stock is 12.84%. The stock that will provide the better annualized holding period return is Stock 1.

whole quiz

1. the sum of all activities involved in getting high-quality products into the marketplace

2.operations

3. the principle of looking at the supply chain as a whole in order to improve the overall flow through the system.

4. produced; performed

5. activities producing tangible products, such as radios, newspapers, buses, and textbooks.

6. activities producing intangible and tangible products, such as entertainment, transportation, and education.

7.   customer focus

8. analyzing a competitor's products to identify desirable improvements

9. the systematic direction and control of the processes that transform resources into finished projects that create value for and provide benefits to consumers.

10. operation management.

your welcome leave a rate and a < 3

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