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- Three years ago, the stock of Malidee Corp. sold for $145.82 per share. Today, the stock sells for $35.15
per share. There have been no stock splits. What is the compound annual growth rate for this company’s
stock? - Three years ago, the stock of Pasmalidee Corp. sold for $145.82 per share. Today, the stock sells for $35.15
per share. The stock had a 5-for-1 split last year. What is the compound annual growth rate for this company’s
stock?
E. Total Rate of Return- My stock in Honeoye Gas and Electric has grown at a CAGR of 4.75% and the stock has paid a dividend yield
averaging 4.15%. Approximately what total rate of return have I earned on this investment? - Suppose that over the past 3 years, Salamanca Semiconductor (from Exercise 10) has paid a dividend rate averaging
1.25%. Approximately what was the total rate of return on this investment over the past 3 years? - Corey invested $8,453.19 in a company dividend reinvestment plan 12 years ago. He has not made any additional
investments or withdrawals, but has kept reinvesting the dividends. Today, his account is worth $15,003.02. Calculate
the total rate of return on his investment. - Over the past 10 years, Metanational Globalnet Corp. (from Exercise 12) has paid an average dividend yield of 2½%.
What is the approximate total rate of return from this stock over this time period?
F. Volatility and Risk- Five years ago, Sam deposited $5,000 in a 5-year certifi cate of deposit, and also invested $5,000 in the stock of
Plancktonol Inc. Today, his CD is worth $6,834.37. His stock is worth $9,130.94.
a. Calculate the compound annual growth rate for each of Sam’s investments.
b. How much was Sam’s CD worth 2 years after he opened it?
c. How much was Sam’s stock worth 2 years after he bought it?
G. Grab Bag- Max bought a collection of rare stamps at an auction 6 years ago for $11,300. A stamp dealer offered to buy the
collection from him today for $18,500. If Max takes this deal, what compound annual growth rate would he have earned
from this investment? - Suppose that a stock pays a $1.42 quarterly dividend, and the stock’s price is currently $92.05. Find the current
dividend yield. - Last month, a boat rental business earned $17,200, which will be distributed among the partners who own and run the
business. They distribute their profi ts as follows: Adrian gets 10 shares, Steve gets 12 shares, and Rene gets 8 shares.
How much will each partner receive?
Exercises 6.1 261