QUESTION ONE The shares of Ecobank Ghana Ltd (EGH) are currently trading at (117.50 per share on the Ghana Stock Exchange (GSE). Ruth is bullish on EGH shares and is considering buying 10,000 shares of EGH. Ruth has a share dealing account with a broker, and is eligible to trade on margin. Her broker charges brokerage commissions of 1.2% for purchases and sales; initial margin deposit of 60% and a maintenance margin of 25%. The interest rate on margin debt is 4% per annum. Other costs for trading securities (purchases and sales) on the Ghana Stock Exchange include: 35 basis points as GSE fees; 15 basis points as Securities Exchange Commission fees; 15 basis points as Securities Depository fees; and 5 basis points as Market Development fees. a. Assuming that Ruth paid the full cost of the purchase and the EGH paid dividends of (130.80 per share during the year, what is her rate of return if at the end of the year she sells the shares for: i. (138.00 per share? ii. (116.50 per share? (15 marks) b. Now, assume that Ruth bought the 10,000 shares on a margin account and the company paid dividends of (130.80 per share during the year. What is her rate of return if at the end of the year she sells the shares for: i. (138.00 per share? ii. (116.50 per share? (20 marks) c. If Ruth purchases the 10,000 shares on a margin account, making the initial margin deposit of 60%, at what share price would she receive a margin call from the broker? (10 marks)