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Which of the following would offer the best return on investment? Assume that you buy $4,000 in stock in all three cases, and ignore interest
Which of the following would offer the best return on investment? Assume that you buy $4,000 in stock in all three cases, and ignore interest and transaction costs in all your calculations.
Buy a stock at $75 without margin and sell it 1 year later at $80.
Buy a stock at $60 with 50% margin and sell it 1 year later at $65.
Buy a stock at $65 with 75% margin and sell it 1 year later at $80.
Alternative -Select-(c)(b)(a)Item 1 offers the best return on the investment.
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