Homework Sourse2 A oneperiod rate of return from an investment can be measu
2. A one-period rate of return from an investment can be measured as: Rate of Return (Ending Value-Beginning Value)+ Income/Beginning Value. If a share of stock goes from $20 to $22 in one year and also pays a dollar in dividends during the year, what is the rate of return for the period? (L01-1) 
Solution
Rate of return = ( Ending value + dividends - Beginning value) / beginning value
Rate of return = ( 22 + 1 - 20 ) / 20
Rate of return = 3 / 20
Rate of return = 0.15 or 15%
