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Suppose you buy a round lot of Horse Inc. stock on 55% margin when it is selling at $40 a share. The broker charges a
Suppose you buy a round lot of Horse Inc. stock on 55% margin when it is selling at $40 a share. The broker charges a 10 percent annual interest rate and commissions are 4 percent of the total stock value on both the purchase and the sale. If at year end you receive a $0.90 per share dividend and sell the stock for 35^(5/8), what is your rate of return on the investment?
Can someone answer this question and explain to me what the text highlighted in bold means in this context? - 35^(5/8)
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