Assume that an investor short-sells 600 shares of stock at a price of $45 a share, making a 50 percent margin deposit. A year later, she repurchases the borrowed shares at $30 a share.   How much of her money did the short-seller have to put up to make this transaction? $   How much money did the investor make, or lose, on this transaction? Ignore margin interest. $   What rate of return did she make on her invested capital (see part a)? Ignore margin interest. Round the answer to two decimal places.  %

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Assume that an investor short-sells 600 shares of stock at a price of $45 a share, making a 50 percent margin deposit. A year later, she repurchases the borrowed shares at $30 a share.

 

    1. How much of her money did the short-seller have to put up to make this transaction?
      $  

    1. How much money did the investor make, or lose, on this transaction? Ignore margin interest.
      $  

  1. What rate of return did she make on her invested capital (see part a)? Ignore margin interest. Round the answer to two decimal places.
     %

 

 
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