You are bullish on Tesla. The current market price is $250 per share, and you have $5,000 of your own to invest. You borrow an additional $5,000 from your broker at an interest rate of 8% per year.

a. What will be your rate of return if the price of Tesla stock goes up by 15% during the next year? The stock currently pays no dividends.

b. How far does the price of Tesla stock have to fall for you to get a margin call if the maintenance margin is 40%?