The price of Walmart stock is currently $41.16 and you decide to buy 130 shares on margin. The inital margin is 60% and the broker's maintenance margin is 20%. The broker charges an effective annual interest rate of 5% on the margin loan.

1) How much money do you have to contribute to the account if you borrow as much as possible?

2) If the price rises to $49.27 after 8 months, what is the new percentage margin in the account?

3) What is your effective annual return?