#1 SUPPOSE THAT YOU BOUGHT 300 SHARES OF IBX AT $100 PER SHARE AND GIVE YOUR BROKER $18000 FOR THE PURCHASE AD BORROW THE REST. CURRENT INTEREST RATE IS 2% A YEAR.

a- IF THE MAINTENANCE MARGIN IS 35% HOW LOW CAN IBXS PRICE FALL ( ASSUMING INTEREST HAS NOT BEEN CHARGED) BEFORE YOU GET A MARGIN CALL ?

b- WHAT WILL BE YOUR RATE OF RETURN IN ONE YEAR WHEN IBX IS SELLING FOR $115? ASSUME THAT IBX PAYS NO DIVIDEND

c- NOW ASSUMING THAT IBX DOES PAY A $1 PER SHARE DIVIDEND AT THE YEAR END, REDO PART B