The investor buys 100 shares of stock for $10 a share and sells it for $14. Also

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The investor buys 100 shares of stock for $10 a share and sells it for $14. Also assume the margin requirement is 60%, the commission rate is 5% of the purchase or sale price, the interest rate is 10% and the stock pays a dividend of $1.00 as hare.

Questions:

What is your rate of return on the stock if it is:

a. a cash purchase?

b. a margin purchase?

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Related Book For answer-question

Investments An Introduction

ISBN: 978-0324561388

9th Edition

Authors: Herbert B Mayo

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Posted Date: Apr 19, 2024 05:18 AM

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The investor buys 100 shares of stock for $10 a share and sells it for $14. Also

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The rate of return on the stock ... View the full answer

Investments An Introduction

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