Thursday, June 6, 2019
Stock Essay Example for Free
threadbare EssayA stock sells for $10 per share. You purchase nose candy shares for $10 a share (i.e., for $1000), and after a year the harm rises to $17.50. What will be the percentage return on your investment if you bought the stock on boundary line and the margin requirement was (a) 25 percent, (b) 50 percent, and (c) 75 percent? (Ignore commissions, dividends, and interest expense.)Initial Stock price per share$10 of Shares Purchased 100New Stock price per share $17.50Gain= New Price Initial Price$750.00 = ($17.50 x 100) ($10 x 100)Purchase Price =Initial Stock price per share x of Shares Purchased$1,000FORMULAPercentage Return =Gain(Margin Requirement x Purchase Price)SOLUTION to (a)300%$750.00$250.00SOLUTION to (b)150%$750.00$500.00SOLUTION to (c)100%$750.00$750.00
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