Business
Business, 07.10.2020 22:01, JoeyDoesMath2399

Suppose that Xtel currently is selling at $66 per share. You buy 500 shares using $20,000 of your own money, borrowing the remainder of the purchase price from your broker. The rate on the margin loan is 6%. a. What is the percentage increase in the net worth of your brokerage account if the price of Xtel immediately changes to: (i) $69.63; (ii) $66; (iii) $62.37? What is the relationship between your percentage return and the percentage change in the price of Xtel?

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Suppose that Xtel currently is selling at $66 per share. You buy 500 shares using $20,000 of your ow...

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