Jeff bought 100 shares of stock for $30.00 per share on 70% margin. Assume Jeff holds the stock for one year and that his interest costs will be $45 over the holding period. Jeff also received dividends amounting to $0.30 per share. Ignoring commissions, what is his percentage return on invested capital if he sells the stock for $34 a share?
Jeff bought 100 shares of stock for $30.00 per share on 70% margin. Assume Jeff holds the stock for one year and that his interest costs will be $45 over the holding period. Jeff also received dividends amounting to $0.30 per share. Ignoring commissions, what is his percentage return on invested capital if he sells the stock for $34 a share?
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
Section: Chapter Questions
Problem 1PS
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Jeff bought 100 shares of stock for $30.00 per share on 70% margin. Assume Jeff holds the stock for one year and that his interest costs will be $45 over the holding period. Jeff also received dividends amounting to $0.30 per share. Ignoring commissions, what is his percentage
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