You purchase 100 shares of stock for $60 a share. The stock pays a $3 per share dividend at year-end. What is the rate of return on your investment if the end-of-year stock price is (i) $57; (ii) $60; (iii) $66? What is your real (inflation-adjusted) rate of return if the inflation rate is 4%?

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You purchase 100 shares of stock for $60 a share. The stock pays a $3 per share dividend at year-end.  What is the rate of return on your investment if the end-of-year stock price is (i) $57; (ii) $60; (iii) $66?  What is your real (inflation-adjusted) rate of return if the inflation rate is 4%?

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