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At the Beginning of 2010,Sally Purchased Besham Stock on Margin

question 21

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At the beginning of 2010,Sally purchased Besham stock on margin.The initial margin requirement is 60 percent and the broker loan rate is 10 percent.Sally invested $15,000 of her own funds and margined the maximum amount allowed by the broker to purchase Besham stock.At the time,the purchase price of the stock was $50 a share.No dividends were paid during the year,and the stock was sold for $48 a share at the end of the 2010.What is the one-year holding period return for this investment?

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Definitions:

Guidelines

A set of recommended practices or instructions designed to shape actions or achieve desired outcomes.

Directive

An instruction or order given with authority, often within an organizational or legal context.

Deliverable

A specific output or result that must be delivered upon completion of a project or part of a project.

Budget

An estimate of income and expenditure for a set period of time, often used for planning and managing finances.

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