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An investor buys 100 shares of stock selling at $76 per share using a margin of 67%. The stock pays annual dividends of $3.00 per share. A margin loan can be obtained at an annual interest cost of 8.6%. Determine what return on invested capital the investor will realize if the price of the stock increases to $110 within six months. What is the annualized rate of return on this transaction? If the price of the stock increases to $110 within six months, the six-month return on this transaction is %. (Round to two decimal places.)

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Home nert Page Layout Formulas Data Review View dd-Ins as Cut aCopy Σ AutoSum Wrap Text General в 1 프· ー· 鱼, Δ. :r-ㄧ 逻锂函Merge & Center. $, % , 弼,8 Conditional Format eCell Insert Delete Formsat Paste Sort &Find & 2 ClearFe Select Edting Format Painter Formatting, as Table w styles. Styles ▼ ㆆ ▼ Clipboard AN149 AL Font Alignment Number Cells AM AN AO AP AQ AR AS AT AU AV AW AX AY 132 133 134 135 136 137 138 139 140 141 142 143 144 145 146 147 148 149 150 11 1 with dividend EQUITY FUNDS BORROWED FUNDS TOTAL INVESTMENT 100 x 76 x 67% 100 x 76 x (1-0.67) 100 X 76 = 5092 2508 7600 150 107.84 DIVIDEND 100 X 3 = 300 AND FOR HALF YEAR IT IS INTEREST PAID-2508 X 8.696 X 6/12 SALE VALUE OF SECURITY = PURCHASE VALUE OF SECURITY = 100 X 110- 100 X 76- 11000 7600 ANS 1 (11000 +150-107.84 - 7600)/5092 100 RETURN ON INVESTED CAPITAL (FOR 6 MONTHS)- (SALE VALUE OF SECURITY DIVIDEND RECEIVED INTEREST PAID- PURCHASE VALUE OF SECURITY)/ AMOUNT OF EQUITY INVESTED 67.60% NS 2 ANNUALISED RATE OF RETURN- (1+0.6760)A2-1 180.90% HIGH LOW TARGET PRICE- STOCK DIV NAV HEDGE FUND MF EV PE EPS DİV ABNORMAL - APV ROSS deberk | MARGIN MONEY al tax ( PB ROPİ e EVA MVAI 07:09 29-01-2019

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