Quick questions on Shares, dividends and yield for HSC Maths Standard 2

A dividend is a cash payment a company pays to shareholders out of its profit. It is usually quoted per share, in dollars and cents.

Dividend yield expresses the dividend as a percentage of the share price:

Total return combines income (dividends received) and capital gain or loss:

Buying and selling shares through a broker costs a fee called brokerage, quoted either as a flat amount (for example $10 a trade with an online broker) or as a percentage of the trade value. Brokerage is paid on the way in and on the way out, so a round trip incurs it twice. When a question mentions brokerage, fold it in:

The price-earnings ratio compares the share price to the company's earnings per share:

In Australia, dividends are often franked (or partly franked), meaning the company has already paid corporate tax on the profit being distributed. This is examinable only in worded form (the question will tell you the cash amount); you do not need to compute the gross-up.

Every percentage in this topic is a percentage "of" some base amount, and the care needed is in choosing that base. The base is the denominator, the number you divide by. Dividend yield is the dividend as a percentage of the current share price (or the original investment, depending on the wording). Total return percentage is the dollar return as a percentage of the original investment, unless the question clearly says otherwise.

Include the sign in the total-return calculation.