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You decide to buy 100 shares of Chevron (CVX) in a marginaccount that has an initial margin of 50%. CVX pays an annualdividend of $4 a share and the stock is currently trading at $100.The cost of borrowing from your broker is 6%. What is your % returnif the stock increases to $125 in 1 year? If the next day after youpurchase the stock bad news comes out and drops the stock to $90.Will you receive a margin call if the maintenance margin is set at20%?please show the work with steps....thanks!
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