Question

What is your annual return if you bought a stock three years ago for $55 and you just sold it for $79, assuming you did not receive any dividends during that time period?

Answer 1

The annual return is $8 per year

Cost price of stock = $55

Selling price of stock = $79

Number of years = 3 years

Annual return will be:

= (Selling price - Cost price) / Number of years.

= ($79 - $55) / 3

= $24/3

= $8

Therefore, the annual return is $8.

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