Answered step by step
Verified Expert Solution
Link Copied!
Question
1 Approved Answer

You obtain a 4 0 % Margin Loan ( Loan / Value ) at annual rate of 4 % to buy 1 5 0 shares

You obtain a 40% Margin Loan (Loan/Value) at annual rate of 4% to buy 150 shares of IBM $190. After 6 months later you sold all the shares at $215. During the hold period you recieved a $3.50 per share dividend. What is your $ profit and return of your investment (Please pay attention of the time of sale).

Step by Step Solution

There are 3 Steps involved in it

Step: 1

Initial Investment Bought 150 shares of IBM at 190 per share so the total cost was 150 190 28500 Mar... blur-text-image
Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Intermediate Accounting

Authors: kieso, weygandt and warfield.

14th Edition

9780470587232, 470587288, 470587237, 978-0470587287

More Books

Students also viewed these Accounting questions

Question

Focus on the interview.

Answered: 1 week ago