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An investor buys 300 shares of stock selling at $93 per share using a margin of 58%. The stock pays annual dividends of $2.00 per
An investor buys 300 shares of stock selling at $93 per share using a margin of 58%. The stock pays annual dividends of $2.00 per share. A margin loan can be obtained at an annual interest cost of 7.3%. Determine what return on invested capital the investor will realize if the price of the stock increases to $102 within six months. What is the annualized rate of return on thistransaction?
If the price of the stock increases to $102 within sixmonths, thesix-month return on this transaction is____%
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