Compute profit and return on the investment

Reference no: EM1361857

Suppose you buy a round lot of Horse Inc stock on 55% margin when it is selling at 38.70 a share. The broker charges an 8 percent annual interest rate and commission are 4.5 percent of the total stock value on the purchase and 5 percent o n the sell. If at year-end you receive a 1.60 per share dividend and sell the stock for 47.30, what is your profit and return on the investment?

Reference no: EM1361857

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