Intro The price of Walmart stock is currently $47.81 and you decide to buy 170 shares on margin. The inital margin is 60% and the broker's maintenance margin is 40%. The broker charges an effective interest rate of 5% on the margin loan. Part 1 - Attempt 1/10 for 10 pts. How much money do you borrow if you borrow as much as possible? 3251 Correct Assets Liabilities & Equity Value of shares (N*P) 8,128 Loan 3,251 Equity 4,877 Total 8,128 Total 8,128 Loan amount: L = Value of shares. (1 Initial margin) = 8,128 . (1 - 0.6) = 3,251 Part 2 - Attempt 1/10 for 10 pts. After the 4 months, the stock price has changed to $44.75 and the stock has paid dividends of $1.18 per share. What is the new percentage margin in the account? 0.57 Correct Loan plus interest: = L. (1+i) = 3,251 (1 + 0.05) = 3,304 Assets Liabilities & Equity Value of shares (N*(P+D)) 7,808 Loan + Interest 3,304 Equity 4,504 Total 7,808 Total 7,808 Percentage margin Equity Value of stock 4,504 7,808 0.577 18 | Attempt 6/10 for 10 pts. Part 3 What is your effective annual return? 3+ decimals Submit