Fin 550 chap 4 homework


Chapter 4  Homework


# 4-7




4. You career to vend blunt 100 distributes of Charlotte Horse Farms when it is vending at its per-annum haughty of $56. Your broker tells you that your edge capacity is 45 percent and that the legation on the escheatment is $155. While you are blunt the supply, Charlotte pays $2.50 per distribute dividend. At the end of one year, you buy 100 distributes of Charlotte at $45 to bar out your standing and are pregnant a legation of $145 and 8 percent portion-out on the money borrowed. What is your blame of come-back on the bombardment?


5. You own 200 distributes of Shamrock Enterprises that you bought at $25 a distribute. The supply is now vending for $45 a distribute.


a. You put in a plug dropping appoint at $40. Discuss your forced for this exercise.


b. If the supply at-last declines in worth to $30 a distribute, what would be your blame of come-back delay and delayout the plug dropping appoint?


6. Two years ago, you bought 300 distributes of Kayleigh Milk Co. for $30 a distribute delay a edge of $60 percent. Currently, the Kayleigh supply is vending for $45 a distribute. Assuming no dividends and ignoring legations, calculate (a) the annualized blame of come-back on this bombardment if you had paid money and (b) your blame of come-back delay the edge escheatment.


7. The supply of the Madison Travel Co. is vending for @28 a distribute. You put in a period buy appoint at $24 for one month. During the month the supply pirce declines to $20, then jumps to $36. Ignoring legations, what would entertain been your blame of come-back on this bombardment? What would be your blame of come-back if you had put in a chaffer appoint? What if your period appoint was at $18?