Seven months ago,Freda purchased 400 shares of stock on margin at a price per share of $36.The initial margin requirement on her account is 70 percent and the maintenance margin is 40 percent.The call money rate is 4.4 percent and she pays 2 percent above that rate.Today,she sold these shares for $37.50 each.What is her annualized rate of return?
A) 7.50 percent
B) 7.61 percent
C) 14.37 percent
D) 16.90 percent
E) 17.42 percent
Correct Answer:
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