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An investor buys $16,000 worth of a stock priced at $20 per share using 60% initial margin. The broker charges 9% on the margin loan
An investor buys $16,000 worth of a stock priced at $20 per share using 60% initial margin. The broker charges 9% on the margin loan and requires a 40% maintenance margin. One year from now, the stock pays a $1.00 per share dividend, and then the stock is sold at $27 per share. Please calculate the above investor's rate of return
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