Nikul XYZ's stock price and dividend history are as follows:Dividend PaidBeginning-of-YearYear Priceat Year-End2020$ 155$ 3202120222023185145155333An investor buys three shares of XYZ at the beginning of 2020, buys another two shares at the beginning of 2021, sells one share atthe beginning of 2022, and sells all four remaining shares at the beginning of 2023.Required:a. What are the arithmetic and geometric average time-weighted rates of return for the investor?Note: Round your year-by-year rates of return and final answers to 2 decimal places. Do not round other calculations.b. What is the dollar-weighted rate of return? (Hint: Carefully prepare a chart of cash flows for the four dates corresponding to theturns of the year for January 1, 2020, to January 1, 2023. If your calculator cannot calculate internal rate of return, you will have touse trial and error.)Note: Round your answer to 4 decimal places. Negative amount should be indicated by a minus sign.a. Arithmetic average rate of returna. Geometric average rate of returnb. Dollar-weighted rate of return%%%

Step 1: The calculation of the arithmetic, geometric, and the dollar-weighted return…

Answered: XYZ's stock price and dividend history…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 3E

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