Nancy Cotton bought 400 shares of NeTalk for $15 per share. One year later, Nancy sold the stock for $20 per share, just after she received a $0.50 cash dividend from the company.
a. What is the total dollar return earned by Nancy for the year?
b. What is the rate of return earned by Nancy?
c. Separate the rate of return computed in part (b) into the dividend yield and the capital gain. In other words, compute the dividend yield and the capital gain that Nancy earned by holding NeTalk for one year.