Explanation:

The correct answer is B ($2,520). Here's the detailed breakdown:

1. Total Purchase Cost:

   • 2,000 shares × $12.00 = $24,000.

2. Equity Investment:

   • Total investment divided by the leverage ratio: $24,000 / 3 = $8,000.

3. Amount Borrowed:

   • Total purchase cost minus equity investment: $24,000 - $8,000 = $16,000.

4. Interest on Loan:

   • 3% of $16,000 = $480.

5. Proceeds from Sale:

   • 2,000 shares × $9.50 = $19,000.

6. Remaining Equity:

   • Proceeds from sale minus borrowed amount and interest: $19,000 - $16,000 - $480 = $2,520.

Why Not A or C?

• A ($460) incorrectly divides the total investment by 4 instead of 3, leading to an inflated equity investment and incorrect remaining equity.
• C ($3,000) omits the interest on the loan, resulting in an overestimation of the remaining equity.