Question

One year ago, you purchased 100 shares of Southern Foods common stock for $41.60 a share. Today, you sold your shares for $39.70 a share. During this past year, the stock paid $1.40 in dividends per share. What is your dividend yield on this investment?

Answer 1

Dividend yield= 3.53%

Step-by-step explanation:

The dividend yield is the proportion of the market price that is earned as dividend. The higher the dividend yield the better for the investor.

The dividend yield is calculated as follows:

Dividend yield = Dividend paid /Current market price per share × 100

Dividend yield = 1.40/39.70× 100= 3.52

Dividend yield= 3.53%