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(6 pts) You want to buy 100 shares of MNO using a 60% margin. The maintenance margin 30%. The current price of MNO is $56.

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(6 pts) You want to buy 100 shares of MNO using a 60% margin. The maintenance margin 30%. The current price of MNO is $56. The interest rate on borrowed money is 5% per year. The stock is not expected to pay a dividend over the course of the next year. How much money did you have to invest today and how much money did you borrow? 2) a) a. 5 top oney Invested today $ Money Borrowed today = $ 2270 b) What Price will trigger a Margin Call? Price that will trigger a Margin Cal At the end of the year, the stock is trading at $61. What is the rate of return on your investment at the end of one year, include the interest on the money borrowed? c) 30 00 pw 00P 240 = 70P Rate of return =

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