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What is the rate of return on the investment

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James has sold short 2,400 shares of Omega Inc. at $42 per share. The initial margin requirement was 50% on the short sale. His broker requires a 35% maintenance margin. Omega pays no dividends. James earns no interest on the funds in his margin account. What is the rate of return on the investment if the price of Omega stock changes from $42 to $37?

Reference no: EM132826133

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