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neonofarm [45]
2 years ago
6

An investor purchased on margin Orange Computer for $30 a share. The stock's price subsequently increased to $50 a share at whic

h time the investor sold the stock. If the margin requirement were 60 percent and the interest rate on borrowed funds were 7 percent, what would be the percentage earned on the investor's funds (excluding commissions)
Business
1 answer:
kicyunya [14]2 years ago
7 0

Answer:

A. 104%

B. 66.7%

Explanation:

A. Calculation for what would be the percentage return earned

Percentage return =($50-$30-30*60%*7%)/30*60%

Percentage return(20-$18*.07)/18=

Percentage return=1.04*100

Percentage return=104%

Therefore what would be the percentage return earned is 104%

B. Calculation for What would have been the return if the investor had notbought the stock on margin

Percentage return=($50-$30)/$30

Percentage return=$20/$30

Percentage return=66.67 %

Percentage return=66.7% Approximately

Therefore What would have been the return if the investor had notbought the stock on margin is 66.7%

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3 years ago
Archie Co. purchased a framing machine for $45,000 on January 1, 2021. The machine is expected to have a four-year life, with a
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Explanation:

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Each year the framing machine reduces by $10,000 meaning in 2022 the depreciation will be $10,000.

BOOK VALUE AT DECEMBER 31, 2022

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On December 31, 2021, it dropped by $10,000.

On December 31, 2022, it dropped by another $10,000.

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3 years ago
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Answer:

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This generation commands respect, special attention and at the same time are more miserly in their spending habits.

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