Exhibit 4.5 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 48

Multiple Choice

Exhibit 4.5
USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
You decide to sell 100 shares of Topgun Enterprises Inc. short when it is selling at its yearly high of $42.25. Your broker tells you that your margin requirement is 60 percent and that the commission on the sale is $20. While you are short, Topgun pays a $0.85 per share dividend. At the end of one year you buy your Topgun shares (cover your short sale) at $44 and are charged a commission of $20 and a 5 percent interest rate.
-Refer to Exhibit 4.5. What is your rate of return on the investment?

• A)10.48%
• B)12.87%
• C)-13.98%
• D)-24.49%
• E)-15.05%

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Definitions:

National Industrial Recovery Act

A law passed in 1933 as part of the New Deal, aimed at stimulating economic recovery during the Great Depression by regulating industry.

Rights Dispute

A disagreement over the legal or contractual rights between two or more parties, often involving interpretation or enforcement of those rights.

Grievance

A complaint or protest regarding unfair treatment, especially one made by an employee against their employer or working conditions.

Traditional Union Contracts

Agreements negotiated between labor unions and employers that outline wages, working conditions, and other employment terms for union members.