You bought 3000 shares of Exxon one year ago for $60 per share. Exxon paid a $1 (per-share) dividend last year. The current stock price is $52.5.

a. What rate of return did you earn from your Exxon investment?

b. If inflation rate over the last year was 2%, what is your real rate of return?

c. Instead of simply buying Exxon shares, you executed the purchase (a year ago) on margin, with the initial margin requirement of 50%. Your broker charges you 5% annual rate on any loans. What is the rate of return from your Exxon investment now? Please explain.