Suppose the call money rate IS 4, 5% and you pays spread of

2.5% over that. You buy 800 shares of stock at $34 per share.

You put up $15,000. If your broker requires a 30% maintenance

margin. What price you will be subjected to margin call? One

year later, the stock is selling for $48 per share, $34 and $29.

Construct an equity balance sheet for each price and the change

in margin account. Calculate your return on investment for each

share price above.