purchased 90 shares of a stock at the start of the month, with part of the purchase financed by your broker. The purchase price was $50 per share. Your broker chargers an effective margin rate of 0%. Your initial margin was 80% and you sold all the shares at the end of the month for $56 per share and repaid the loan. The stock paid a $3 dividend per share while you held the stock. What return would you have earned if you had completed the same sequence of events without borrowing from your bro
purchased 90 shares of a stock at the start of the month, with part of the purchase financed by your broker. The purchase price was $50 per share. Your broker chargers an effective margin rate of 0%. Your initial margin was 80% and you sold all the shares at the end of the month for $56 per share and repaid the loan. The stock paid a $3 dividend per share while you held the stock. What return would you have earned if you had completed the same sequence of events without borrowing from your bro
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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You purchased 90 shares of a stock at the start of the month, with part of the purchase financed by your broker. The purchase price was $50 per share. Your broker chargers an effective margin rate of 0%. Your initial margin was 80% and you sold all the shares at the end of the month for $56 per share and repaid the loan. The stock paid a $3 dividend per share while you held the stock. What return would you have earned if you had completed the same sequence of events without borrowing from your broker?
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