Kevin owns 1 share of Acme, Inc. stock. He purchased the stock three years ago for $27. The stock is currently trading for $29.50 per share. The stock has paid the following dividends over the past three years. Year 1) S 1.50 Year 2) $2.00 Year 3) $2.50 What is the compounded rate of return (IRR) that Kevin has earned on this investment?

EBK CFIN
6th Edition
ISBN:9781337671743
Author:BESLEY
Publisher:BESLEY
Chapter5: The Cost Of Money (interest Rates)
Section: Chapter Questions
Problem 2PROB
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Kevin owns 1 share of Acme, Inc. stock. He purchased the
stock three years ago for $27. The stock is currently
trading for $29.50 per share. The stock has paid the
following dividends over the past three years. Year 1) S
1.50 Year 2) $2.00 Year 3) $2.50 What is the compounded
rate of return (IRR) that Kevin has earned on this
investment?
Transcribed Image Text:Kevin owns 1 share of Acme, Inc. stock. He purchased the stock three years ago for $27. The stock is currently trading for $29.50 per share. The stock has paid the following dividends over the past three years. Year 1) S 1.50 Year 2) $2.00 Year 3) $2.50 What is the compounded rate of return (IRR) that Kevin has earned on this investment?
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