Calculate the euro-based return an Italian investor would have realized by investing €10,000 into a £50 British stock using 50 percent margin.One year after investment,the stock pays a £1 dividend,and sells for £54 the exchange rate has changed from €1.25 per pound to €1.30 per pound.The interest on the margin loan is 1 percent per year.The margin loan was denominated in pounds.
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