You are bullish on Telecom stock. The current market price is $$60$ per share, and you have $$5,100$ of your own to invest. You borrow an additional $$5,100$ from your broker at an interest rate of $9\%$ per year and invest $$10,200$ in the stock.

Required:

What will be your rate of return if the price of Telecom stock goes up by $10\%$ during the next year? The stock currently pays no dividends.

How far does the price of Telecom stock have to fall for you to get a margin call if the maintenance margin is $20\%?$ Assume the price fall happens immediately.