(2 points) What is the bank’s 1-month return on assets? (2 points) What is the bank’s 1-month return on equity? The following problem is regarding the following stock information. Assume that the cost of borrowing a stock is computed using the initial value of the stock and the following formula: Stock Today’s Share Price Commission per Borrow Rate share Microsoft $25.00 $0.50 0.5% Apple $500.00 $0.50 1.0% (4 points) You buy 2,000 shares of Apple and sell 40,000 shares of Microsoft at these prices. After 1 year the Apple share price drops to $475 the Microsoft share price drops to $20. You then sell the portfolio. What is the return in dollars of this portfolio? Take account of all costs. (4 points) You buy 2,000 shares of Apple and sell 40,000 shares of Microsoft at these prices. You are planning on holding the position for
(2 points) What is the bank’s 1-month return on assets? (2 points) What is the bank’s 1-month return on equity? The following problem is regarding the following stock information. Assume that the cost of borrowing a stock is computed using the initial value of the stock and the following formula: Stock Today’s Share Price Commission per share Borrow Rate Microsoft $25.00 $0.50 0.5% Apple $500.00 $0.50 1.0% (4 points) You buy 2,000 shares of Apple and sell 40,000 shares of Microsoft at these prices. After 1 year the Apple share price drops to $475 the Microsoft share price drops to $20. You then sell the portfolio. What is the return in dollars of this portfolio? Take account of all costs. (4 points) You buy 2,000 shares of Apple and sell 40,000 shares of Microsoft at these prices. You are planning on holding the position for
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