Suppose You Are a Euro-Based Investor Who Just Sold Microsoft

Multiple Choice

Suppose you are a euro-based investor who just sold Microsoft shares that you had bought six months ago. You had invested €10,000 to buy Microsoft shares for $120 per share; the exchange rate was $1.55 per euro. You sold the stock for $135 per share and converted the dollar proceeds into euro at the exchange rate of $1.50 per euro. Compute the rate of return on your investment in euro terms.

A) 12.50%
B) 16.25%
C) 28.00%
D) -9.09%