Question

A year ago, Kim Altman purchased 170 shares of BLK, Inc. for $40.00 on margin. At that time the margin requirement was 20 percent. If the interest rate on borrowed funds was 8 percent and she sold the stock for $49.00, what is the percentage return on the funds she invested in the stock? Round your answer to two decimal places.

Answer 1

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

PE EPS, STOCK DIVIDEND - Microsoft Excel (Product Activation Failed) View Add-Ins Formulas Data Review - 2x 11 Dr General File Home Insert Page Layout % Cut Calibri Ea Copy Paste Format Painter BIU - D Clipboard Font DR133 fx AA = = = A Wrap Text Merge & Center - Σ AutoSum : A Fill 2 Sort & m Find & $ :.: % , Number Formatting as Table Styles Styles 2 Clear Filter Editing Select Alignment Cells - DO DR DS DI DU PURCHASE VALUE OF SHARES = DV DW 170 X 40 = DX 6800 DY DZ EA 5 116 117 118 119 120 OWN FUNDS = BORROWED FUNDS = 20% 80% 1360 5440 121 INITIAL INVESTMENT = 1360 PRICE after a year = 49 170 X 49 = 5440*(1+0.08) = 122 123 124 125 126 127 128 129 130 131 132 133 134 135 VALUE OF INVESTMENT = PAYMENT TO A BROKER WITH 8% INTEREST = MY POSITION AFTER PAYMENT TO A BROKER = OWN INVESTMENT = FINAL PROFIT = 8330 5875 2455 1360 1095 ANSWER RETURN ON INVESTMENT = 1095/1360 = 80.50% 136 NON Rea STOCK DIV NAV HEDGE FUND ME EV PE EPS DIV ABNORMAL deberk MARGIN MONEY marginal tax PB ROPI APV ROSS I HIGH LOW TARGET PRICE ferences price quote EVA MVAL B0 120% 0 + ELEB * 10 ENG 30-10-2019