Problem 2-14 Margin and Leverage (LO3, CFA4) Suppose you purchase 800 shares of stock at $61 per share with an initial cash investment of $24,400. The call money rate is 5 percent and you are charged a 1.5 percent premium over this rate. Ignore dividends. a. Calculate your return on investment one year later if the share price is $69. Suppose instead you had simply purchased $24,400 of stock with no margin. What would your rate of return have been now? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) With margin Without margin Rate of Return % % b. Calculate your return on investment one year later if the share price is $61. Suppose instead you had simply purchased $24,400 of stock with no margin. What would your rate of return have been now? (A negative value should be indicated by a minus sign. Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) With margin Without margin Rate of Return % % c. Calculate your return on investment one year later if the share price is $45. Suppose instead you had simply purchased $24,400 of stock with no margin. What would your rate of return have been now? (A negative value should be indicated by a minus sign. Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) Rate of Return With margin Without margin %