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Five years ago, Benjamin invested in Parchar Special Effects. He purchased four par value $1,000 bonds from Parchar Special Effects at a market rate of 96.230. Each bond had an interest rate of 7.2%. Benjamin also purchased 200 shares of stock in the same company, each of which cost $19.08 and had a yearly dividend of $2.04. Today, bonds from Parchar Special Effects have a market rate of 104.595, and stock in Parchar Special Effects costs $22.62. If Benjamin liquidates his portfolio and sells all of his investments, which aspect of his investment will have yielded him a greater total profit, and how much greater is it?
a.
The bonds yielded $940.20 more in profits than the stocks.
b.
The bonds yielded $33.00 more in profits than the stocks.
c.
The stocks yielded $373.20 more in profits than the bonds.
d.
The stocks yielded $973.40 more in profits than the bonds.

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Answer :

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Answer:

D.) The stocks yielded $973.36 more in profits than the bonds.

Step-by-step explanation:

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The aspect of Benjamin's investments that yielded him a greater total profit is; D. The stocks yielded $973.40 more in profits than the bonds.

How to Calculate Investments, Bonds and stocks?

Data and Calculations:

                                                    Bonds           Stock

Purchase cost                         $3,849.20        $3,816

                                (96.230 * $1,000 * 4)    ($19.08 * 200)

Interest rate of bonds                 7.2%

Dividend per share                                           $2.04

Annual income for 5 years      $1,440            $2,040

                                ($4,000 * 7.2% * 5)       (200 *$2.04 * 5)

Current market value             $4,183.80       $4,524

                                (104.595 * $1,000)        ($22.62 * 200)

Profit from sale                        $334.60            $708 ($4,524 - $3,816)

Total profit from investment $1,774.60       $2,748 ($2,040 + $708)

Benjamin's investments in stocks yielded $973.40 ($2,748 - $1,774.60) more in profits than the bonds.

Thus, the aspect of Benjamin's investments that yielded him a greater total profit is the investment in Parchar stocks, and by $973.40.

Read more about Investments, bonds and stocks at; https://brainly.com/question/2147117

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