(Last Word) Suppose Balin Has $100 to Invest in an Opportunity

Multiple Choice

(Last Word) Suppose Balin has $100 to invest in an opportunity that returns, for every $100 invested, $120 if it goes well but only $80 if it goes poorly. If leverage allows Balin to borrow $90 for every $10 he invests, what are
His rates of profit and loss, respectively, if he borrows the full amount to invest in the opportunity?

A) 20 percent profit; 20 percent loss
B) 33.3 percent profit; 50 percent loss
C) 200 percent profit; 100 percent loss
D) 1,100 percent profit; 100 percent loss