Tao would like to purchase a stock priced at $80. The stock is not expected to pay any dividends in the coming year. He can either put up the entire amount and purchase the stock, or borrow $45 from her brokerage firm at an annual interest rate of 10 percent and put up the remainder. She thinks she can sell the stock for $100 after one year. If she borrows from her brokerage firm, her estimated return on the stock would be percent. A) 42.86
Tao would like to purchase a stock priced at $80. The stock is not expected to pay any dividends in the coming year. He can either put up the entire amount and purchase the stock, or borrow $45 from her brokerage firm at an annual interest rate of 10 percent and put up the remainder. She thinks she can sell the stock for $100 after one year. If she borrows from her brokerage firm, her estimated return on the stock would be percent. A) 42.86
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
Section: Chapter Questions
Problem 1PS
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