Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. (i) (ii) suppose that you buy a stock for $48 by p

(i) (ii) Suppose that you buy a stock for $48 by paying $25 and borrowing...

80.2K

Verified Solution

Question

Finance

image

(i) (ii) Suppose that you buy a stock for $48 by paying $25 and borrowing the remaining amount from a brokerage firm at 8% annualized interest. The stock pays an annual dividend of $0.80 per share, and after one year, you are able to sell it for $65. Calculate your return on the stock. (6) Assume the scenario in (i) above, then calculate the return on the stock if you had used only personal funds to make the purchase. (4) 4 What is the return if by using personal funds only you are able to sell the stock for only $40 after one year? (4)

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students