When she turned 21, Reese purchased 125 shares of Stock A for $35 per share; 72 shares of Stock B for $18 per share; 56 shares of Stock C for $43 per share; and 105 shares of Stock D for $26 per share. At age 30, Reese sold Stock A for $4804 with annual dividends of $75 per year, Stock B for $1456, Stock C for $2384, and Stock D for $3475. Which stock provided Reese with the greatest return on her investment?

Stock A

Stock B

Stock C

Stock D

Question

When she turned 21, Reese purchased 125 shares of Stock A for $35 per share; 72 shares of Stock B for $18 per share; 56 shares of Stock C for $43 per share; and 105 shares of Stock D for $26 per share. At age 30, Reese sold Stock A for $4804 with annual dividends of $75 per year, Stock B for $1456, Stock C for $2384, and Stock D for $3475. Which stock provided Reese with the greatest return on her investment?

 Stock A

 Stock B

 Stock C

 Stock D

anonymous · Answer

from age 21 to age 30  = 8years

Stock a= investment is 125*35 = 4375
proceeds = dividends plus sales = 75*8  +  4804  = 600+4804  = $5404
profit = 5404- 4375  =1029   ..that is 23.52 % on investment.

stock b = investment is 72 * 18 =  1296
proceeds  = 1456
profit = 1456-1296 = 160, that is 12.35% on investments

stock c = investment is 56 * 43 =2408
proceeds = 2384
loss = 2408-2384 = 24 (negative)

stock d =  investment is 2730
proceeds =  3475
profits = 3475-2730 = 745, that is 27.28 % on investments.

it means stock D provided the highest return.