Question: Problem 2-16 Margin and Leverage (LO3, CFA4) Suppose the call money rate is 4.5 percent, and you pay a spread of 2.5 percent over that
Problem 2-16 Margin and Leverage (LO3, CFA4) Suppose the call money rate is 4.5 percent, and you pay a spread of 2.5 percent over that you buy 700 shares of stock at $89 per share. You put up $43,610. One year later, the stock is selling for $99 per share and you close out your position. What is your return assuming a dividend of $ 70 per share is paid? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Answer is complete but not entirely correct. Rate of retur 22 65 %
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