17) Quentin purchased 600 shares of stock on margin for $25.38 a share and sold the shares seven months later for $30.39 a share. The initial margin requirement was 70% and the maintenance margin was 30%. The interest rate on the margin loan was 4.5%. He received no dividend income. What was his holding period return? A) 9.05% B) 9.45% C) 11.46% D) 12.67% E) 27.09%

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Question
17) Quentin purchased 600 shares of stock on margin for $25.38 a share and sold the shares
seven months later for $30.39 a share. The initial margin requirement was 70% and the
maintenance margin was 30%. The interest rate on the margin loan was 4.5%. He received no
dividend income. What was his holding period return?
A) 9.05%
B) 9.45%
C) 11.46%
D) 12.67%
E) 27.09%
Transcribed Image Text:17) Quentin purchased 600 shares of stock on margin for $25.38 a share and sold the shares seven months later for $30.39 a share. The initial margin requirement was 70% and the maintenance margin was 30%. The interest rate on the margin loan was 4.5%. He received no dividend income. What was his holding period return? A) 9.05% B) 9.45% C) 11.46% D) 12.67% E) 27.09%
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