An investor is thinking about buying some shares of a company at $ 75 a share. She expects the stock to rise to $ 115 a share over the next 3 years. During that time, she also expects to receive annual dividends at $ 4 a share. Assuming that the future value and the dividends it pays hold up, what rate of return can she expect to earn on this investment?

Question

An investor is thinking about buying some shares of a company at $ 75 a share. She expects the stock to rise to  $ 115 a share over the next 3 years. During that time, she also expects to receive annual dividends at $ 4 a share. Assuming that the future value and the dividends it pays hold up, what rate of return can she expect to earn on this investment?