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EMI, CAGR & Depreciation · Question 32 of 66

Question 32

EasyOriginal question

A share is bought for ₹400, pays a dividend of ₹20 and is sold a year later for ₹440. What is the rate of return for the year?

Options for question 32

Show the answer and explanation
CorrectNot quiteAnswer D

Correct answer: D

Explanation

  1. Gain =(440−400)+20=60= (440 - 400) + 20 = 60 rupees.

  2. Rate of return =60400=15%= \frac{60}{400} = 15\%.

Worth noting

10% counts the rise in price but leaves out the dividend.

Concept
The rate of return
Typical time
60 s
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