You Purchased 100 Shares of Highlight Company for $20 a Share

question 73

Multiple Choice

You purchased 100 shares of Highlight Company for $20 a share one year ago with a margin of 50 percent. The stock is currently selling for $28 a share, and no dividends were ever paid. The broker charges an annual interest rate of 8 percent and a $100 commission on both the purchase and sale of these shares. What is your annual rate of return on this investment?

• A) 21 percent
• B) 47 percent
• C) 52 percent
• D) 60 percent
• E) 72 percent