Question - Basic Net Present Value Analysis
Kathy Myers frequently purchases stocks and bond, but she is uncertain how to detemine he rate of return on what she is earning. 3 years ago she paid 13000 for 200 shares of Malti Companies Stock. She received 420$ cash divided on the stock at the end of each year for 3 years. At the end of 3 years she sold the stock for 16000. Kathy would like to earn a return rate of at least 14% on all of her investments. She is not sure whether the Malti Company stock provided a 14% return and would like help with the necessary computations.
Ignore income taxes: Using the net present value method, determine whether or not the Malti Company stock provided a 14% return. Use the general format and round all computations to the nearest whole dollar.