Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

Old Economy Traders opened an account to short sell 1,000 shares of Internet Dreams at $40 per share. The initial margin requirement was 50%. The

image text in transcribed

Old Economy Traders opened an account to short sell 1,000 shares of Internet Dreams at $40 per share. 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 $50, and the stock has paid a dividend of $2 per share. What is the rate of return, in percentage, on the investment? Round your answer in two decimal places

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Finance questions

Question

- 3 x 2 + 4 ( x - 1 ) ( x 2 + 4 ) d x

Answered: 1 week ago