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1. Suppose you bought 500 shares of Johnson & Johnson stock at an initial price of $37.00 per share. The stock paid a dividend of

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1. Suppose you bought 500 shares of Johnson & Johnson stock at an initial price of $37.00 per share. The stock paid a dividend of $0.28 per share during the following year, and the share price at the end of the year was $34. Compute your total dollar return on this investment. (5 marks) 2. Using the details from question 1 above, What is the capital gains yield? (2 marks) What is the dividend yield? (2 marks) What is the total rate of return? (2 marks) 3. A stock has returns of -9%, 17%, 9%, 14%, -4%. What are the arithmetic and geometric returns? (6 marks) 4. Using the following data, calculate the Variance and Standard deviation: (10 marks) Returns: Year 1 = 17%, Year 2 = 11%, Year 3 = -2%, Year 4 = 3%, Year 5 = 14% 5. Gilead Science stock sells for $17 per share and you have decided to purchase as many shares as you possibly can. You have $31,000 available to invest. What is the maximum number of shares you can buy if the initial margin is 60% ? (5 marks) 6. You decide to buy 1,200 shares of stock at a price of $34 and an initial margin of 55 percent. What is the maximum percentage decline in the stock before you will receive a margin call if the maintenance margin is 35 percent? (6 marks)

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