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An investor buys $16,000 worth of a stock priced at $30 per share using a 45% initial margin. The broker charges 8% on the margin
An investor buys $16,000 worth of a stock priced at $30 per share using a 45% initial margin. The broker charges 8% on the margin loan and requires a 35% initial margin. The stock pays a $1.00 per share dividend in one year and then the stock is sold at $32 per share. What was the investor's rate of return?
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