A couple bought some stock for $30 per share that pays an annual dividend of $0.90 per share. After 1 year the price of the stock was $33. Find the simple interest rate on the growth of their investment.
The simple interest rate will be found as follows: A=Pe^(rt) where: A=$33 P=(30+0.9)=$30.9 t=1 year plugging into our formula we get: 33=30.9e^(r*1) 33=30.9e^r 1.067961=e^r introducing natural logs we get r=ln 1.06761 r~0.06575 Answer: 0.06575 or 6.575%
