Blog

Assume you buy 550 shares of stock at $12.60 per share on margin (43 percent). How much would you need to contribute to initiate this position?

Assume you buy 400 shares of stock at $9.30 per share on margin (75 percent). How much would you need to contribute to initiate this position?

Given the following financial data: Net income / Sales = 4 percent; Sales / Total assets = 2.5 times; Debt / Total assets = 45 percent; compute return on assets.

Hazel purchased 650 shares of Baby Jenae stock for $10.00 a share. The stock was purchased with an initial margin of 70 percent. The maintenance margin is 49 percent. The stock is currently selling for $4.70 a share. What is the minimum dollar amount of equity that she must have in this stock today to avoid a margin call?

Assume the real rate of return in the economy is 1.4 percent, the expected rate of inflation is 4.3 percent, and the risk premium is 4.9 percent. Compute the required rate of return.(Be sure to give the EXACT rate, not the approximate rate).

Which of the following are ineffective strategies for producing excess returns if the market is semistrong-form efficient?I. graphing past prices searching for patterns II. watching the daily market movements III. studying the latest analyst’s reports IV. analyzing a firm’s financial statements

Washington Corp. has to cover a $30,000 sinking fund payment. The firm is in the 25% tax bracket, and the treasurer wants to know how much before-tax income is required for the firm to cover its sinking fund

Washington Corp. has to cover a $80,000 sinking fund payment. The firm is in the 30% tax bracket, and the treasurer wants to know how much before-tax income is required for the firm to cover its sinking fund

You sell 900 shares of Kenny Corporation short. The price of the stock is $17.50 per share. The margin requirement is 61 percent. If stock goes up to $23.80, what is your percentage gain or loss on the initial margin (equity). Round your answer to the nearest basis point (i.e. xx.xx%). Denote a loss with a negative sign (-).

A stock has produced returns of 38 percent, 40 percent, –12 percent, and 8 percent over the past four years, respectively. What is the geometric average return?