you open a margin account at chas pigeon a discounted broker. you subsequently short exciting.com at @$86, beleiving it to be overpaid. this transaction is done on ,argin which has an annual interest rate cost of 4%. exactly one year later exciting has decline to $54 a share at which point you cover your short position. you pay brokerage cost of $7 on each transaction you make.

a. the margin requirement is 50%. calculate your dollar gain or loss on this position, taking into account both the margin interest and the transaction cost to sell.

b. calculate the %return on your investment(the amount of money you put up initially, counting the brokrage costs to buy.)