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You purchase 9 0 0 shares of 2 nd Chance Co . stock on margin at a price of $ 5 6 . Your broker
You purchase shares of nd Chance Co stock on margin at a price of $ Your broker requires an initial margin of $ Assuming no dividends or interests.
a Suppose you sell the stock at a price of $ What is your return?
Holding Period Return
With margin loan
What would your return have been had you purchased the stock without margin?
Holding Period Return
Without margin loan
b What is your return if the stock price is $ when you sell the stock?
Holding Period Return
With margin loan
What would your return have been had you purchased the stock without margin?
Holding Period Return
Without margin loan
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