Barbara buys 130 shares of DEM at $34.00 a share and 190 shares of GOP at $37.00 a share. She buys on margin and the broker charges interest of 6 percent on the loan. If the margin requirement is 43 percent, what is the maximum amount she can borrow? Round your answer to the nearest cent. $ If she buys the stocks using the borrowed money and holds the securities for a year, how much interest must she pay? Round your answer to the nearest cent. $ If after a year she sells DEM for $25.00 a share and GOP for $30.00 a share, how much did she lose on her investment? Use a minus sign to enter the amount as a negative value. Round your answer to the nearest cent. $ What is the percentage loss on the funds she invested if the interest payment is included in the calculation? Use a minus sign to enter the amount as a negative value. Round your answer to two decimal places

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Barbara buys 130 shares of DEM at $34.00 a share and 190 shares of GOP at $37.00 a share. She buys on margin and the broker charges interest of 6 percent on the loan.

  1. If the margin requirement is 43 percent, what is the maximum amount she can borrow? Round your answer to the nearest cent.

    $  

  2. If she buys the stocks using the borrowed money and holds the securities for a year, how much interest must she pay? Round your answer to the nearest cent.

    $  

  3. If after a year she sells DEM for $25.00 a share and GOP for $30.00 a share, how much did she lose on her investment? Use a minus sign to enter the amount as a negative value. Round your answer to the nearest cent.

    $  

  4. What is the percentage loss on the funds she invested if the interest payment is included in the calculation? Use a minus sign to enter the amount as a negative value. Round your answer to two decimal places.

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