AC Motors has a share price of? $22

Finance Apr 01, 2021

AC Motors has a share price of? $22.9 today. If AC Motors is expected to pay a dividend of? $0.7 this? year, and its stock price is expected to grow to? $26.75 at the end of the? year, then? AC Motors' capital gain rate is ________%

Expert Solution

Computation of Capital Gain Rate:

Capital Gain Rate = Capital Gain / Price Today

= ($26.75-$22.9)/$22.9

Capital Gain Rate = 16.81%

So, AC Motor's Capital Gain Rate is 16.81%.

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