Tuesday, 1 October 2019

You purchase 120 shares for $40 a share ($4,800), and after a year the price falls to $35. Calculate the

You purchase 120 shares for $40 a share ($4,800), and after a year the price falls to $35. Calculate the percentage return on your investment if you bought the stock on margin and the margin requirement was (ignore commissions, dividends, and interest expense):
15 percent. Use a minus sign to enter the amount as a negative value. Round your answer to one decimal place.
55 percent. Use a minus sign to enter the amount as a negative value. Round your answer to one decimal place.
80 percent. Use a minus sign to enter the amount as a negative value. Round your answer to one decimal place.

You purchase 120 shares for $40 a share ($4,800), and after a year the price falls to $35. Calculate the

You purchase 120 shares for $40 a share ($4,800), and after a year the price falls to $35. Calculate the percentage return on your investment if you bought the stock on margin and the margin requirement was (ignore commissions, dividends, and interest expense):
15 percent. Use a minus sign to enter the amount as a negative value. Round your answer to one decimal place.
55 percent. Use a minus sign to enter the amount as a negative value. Round your answer to one decimal place.
80 percent. Use a minus sign to enter the amount as a negative value. Round your answer to one decimal place.

The SGS Co. had $258,000 in taxable income. Use the rates from Table 2.3. (Do not round intermediate

The SGS Co. had $258,000 in taxable income. Use the rates from Table 2.3. (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) Calculate the company’s income taxes. Income taxes = $

) In a market with three assets, the portfolios P1 = (0.6, 0.3, 0.1) and P2 = (- 0.2, 0.5, 0.7) lie on the

) In a market with three assets, the portfolios P1 = (0.6, 0.3, 0.1) and P2 = (- 0.2, 0.5, 0.7) lie on the Minimum Variance Set. The portfolios have returns 12% and 4% respectively.
a) Find the portfolio on the MVS with return 14%.
b) Does the portfolio P = (0.1, 0.4, 0.5) lie on the MVS ? Explain.

2) At end of Day 1, I invest equal amounts of money in shares of company A and B.

2) At end of Day 1, I invest equal amounts of money in shares of company A and B.
By end of Day 2, the price of company A shares has doubled and the price of company B shares has halved (compared to Day 1 price).
  • What is the return on my entire investment from Day 1 to Day 2 ?
  • What are the weights of my portfolio at the end of Day 2 ?
  • At the end of Day 3, the price of company A shares has halved and the price of company B shares has quadrupled (compared to Day 2 price).
What is the return on my investment from end of Day 1 to end of Day 3 ?

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