You purchased 269 shares of common stock on margin for $45.22 per share. The initial margin is 50% and the stock pays no dividend. Your rate of return would be __________ if you sell the stock at $48 per share. Ignore interest on margin. Group of answer choices 21.08% 14.05% 15.81% 19.32% 12.30%

You purchased 269 shares of common stock on margin for $45.22 per share. The initial margin is 50% and the stock pays no dividend. Your rate of return would be __________ if you sell the stock at $48 per share. Ignore interest on margin. Group of answer choices 21.08% 14.05% 15.81% 19.32% 12.30%

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter8: Basic Stock Valuation

Section: Chapter Questions

Problem 21MC

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Question

Group of answer choices

21.08%

14.05%

15.81%

19.32%

12.30%

Definition Definition Percentage gain or loss from a specific investment over time. The rate of return is the difference between the closing and initial values of an investment divided by the initial value of the investment. The closing value includes any intermediate cash flows such as dividends or interest amounts.

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