Answered step by step
Verified Expert Solution
Question
1 Approved Answer
An investor bought on margin 100 shares of Copier Corp for $85 a share. The firm paid an annual dividend of $4 a share; the
An investor bought on margin 100 shares of Copier Corp for $85 a share. The firm paid an annual dividend of $4 a share; the margin requirement was 60% with an interest rate of 8% on borrowed funds and comissions on the purchase and sale were $75. 1) What is the % earned on the investment if stock is bought for cash (the investor didd not use margin?) 2) what is the % earned on the investment if the stock is bought on margin?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started