1. An investor purchases 100 shares of ABC stock at $55 per share on margin. The stock pays an annual dividend of $5. Commissions are 2% of the value of a purchase or sale; the margin requirement is 60%, and the interest rate is 10% annually on borrowed funds. What is the percentage return for the investor if the stock is sold at $60 per share after a one year holding period
A) 13.7%
B) 14.65%
C) 16.22%
D) 18.45%
2. Compute yield to maturity for a bond ($1,000 face value) with an 8% coupon that pays semiannual interest, maturing in 15 years priced at $840
A) 10.093%
B) 5.046%
C) 9.452%
D) 10.118%