Old Economy Traders opened an account to short sell 1,000 shares at the price per share of $40 of Internet Dreams. The initial margin requirement was 50%. (The margin account pays no interest.) A year later, the price of Internet Dreams has risen from $40 to $45, and the stock has paid a dividend of $3 per share.

If the maintenance margin requirement is 30%, will Old Economy receive a margin call?

What is the rate of return on the investment?