SIE Exam Question 672: Answer and Explanation

Question: 672

An investor purchased a share of Kappa stock for $184 and sold it for $173. If a $4.25 dividend was paid during the holding period, what was the total return?

• A. -4.67%
• B. -4.33%
• C. -4.02%
• D. -3.67%

Correct Answer: D

Explanation:

R_t = (P_t - P_t-1 + D_t) ÷ P_t-1

R_t = ($173 - $184 + $4.25) ÷ $184 = -0.0367 = -3.67%