Rate o Returns?

Question

What rate of return is expected from a stock that sells for $30 per share, pays $1.50 annually in dividends, and is expected to sell for $33 per share in one year?

Answer 1

Its one-year rate of return is expected to be 15%. Beyond that, the expected rate of total return will drop if the stock price continues to rise at the same rate, but the dividend holds steady at $1.50.