b. Construct the balance sheet that corresponds to the transaction described in requirement a. Assets Liabilities and Equity Stock Short position (100 shares) T-bills Equity Total assets Total liabilities and equity c. Now suppose the price of the stock falls to $78 per share. What is your current margin percentage? (Round your answer to decimal places.) Margin percentage % d. The maintenance margin is 30%. At what stock price would you get a margin call? (Round your answer to 2 decimal places Stock price

Q: You invested in 800 shares of stock for $49.20 a share. The initial margin requirement is 65 percent…

A: “Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…

Q: You purchase 500 shares of Compucon for $120 per share using a margin account. This transaction…

A: Margin call price can be found by using the following formula:

Q: How much do you need to contribute to your margin account (in dollars) at t=0? What will be your…

A: Contribution to Margin Account  = No. of shares shorted * Price * Initial marginFormula:

Q: Suppose you think that the market price of a share of Facebook will increase in the next few month…

A: The margin account refers to the account where the account holder pays a particular percentage of…

Q: You buy a stock at $100 and sell it for $140;what is the percentage return if the margin requirement…

A: given, purchase price = $100 selling price = $140 margin required = 40% interest= 10%

Q: You purchase 200 shares for $50 a share, and after a year the price rises to $70. What is…

A: Hence, the question has been solved in detailed explanation manner.Explanation:The breakdown of your…

Q: D Question 1 You buy 100 shares of Loser Co. at a market price of $85 per share. The initial margin…

A: A broker or lender may request that an investor deposit more money or securities into their margin…

Q: Determine at what share price you will receive a margin call. You short 200 shares of a stock…

A: Margin call price is minimum share price expected to be held or Amount required to maintain in the…

Q: Can you answer b please

A: Solving  b)    Data given: Purchased shares on margin at $5 per share Limit sell order at $7 Stop…

Q: You sold short 200 shares of META at $130 per share. You put up additional $13,000 to meet the 50%…

A: Each share issued by a corporation that is publicly traded has a fixed price. The cost of a share of…

Q: Q.An investor buys $16,000 worth of a stock priced at $20 per share using 60% initial margin. The…

A: When a margin account is used, the initial margin is the percentage of the given purchase price…

Q: Suppose the call money rate is 4.5 percent, and you pay a spread of 2.5 percent over that. You buy…

A: Rate of return refers to the minimum return that is being earned by an investor over an investment…

Q: Say you bought 100 shares of Harasser Flasher Inc. on margin for $100 per share. If the stock price…

A: Buying shares on margin is when you borrow money from a brokerage to purchase shares.

Q: Assume you buy 100 shares of stock at Php40 per share on margin (40 percent). If the price rises to…

A: We need to compute percentage return due to price rise or fall.

Q: Suppose you short sell 100 shares of Twitter priced at $50 a share. The initial margin is 50% and…

A: You have a short position. We need to show the initial balance sheet. We need to find the price that…

Q: Assume an initial margin requirement of 50% and a maintenance margin of 30%. An investor buys 100…

A: The answer is given below:

Q: Assume that an investor buys 100 shares of stock at $53 per share, putting up a 61% margin. If the…

A: A margin account refers to a brokerage account where securities are bought by paying only a portion…

Q: You are looking into purchasing stock of Broken at of your own money as possible (i.e. maximizing…

A: Margin plays a very important role for retail investors who do not have the entire sum of money to…

Q: u've borrowed $24,128 on margin to buy shares in Ixnay, which is now selling at $41.6 per share. You…

A: The margin call price is calculated by multiplying the current price by (1-Initial margin) and then…

Q: purchase You pur snares of Company mmon stock on margin at $30 per share. Assu e initial margin is…

A: There are various sources that are used by the company in order to raise the finance, One of them is…

Q: Suppose you purchase one share of the stock of Volatile Engineering Corporation at the beginning of…

A: Year Cash Flows Description 0 -36 Purchase one share for 36    (-36) 1 -28 Receive dividend…

Q: Suppose that XTel currently is selling at $50 per share. You buy 800 shares using $30,000 of your…

A: Purchase Price of Share is $50 No. of Shares is 800 Own Money is $30,000 Rate on Margin Loan is 7%

Q: What is the rate of return when 30 shares of stock a, purchased for 30$/ share, are sold for $1100?…

A: Rate of Return : It is the rate of earning on the initial investment amount. It is calculated by…

Q: Suppose you purchase one share of the stock of Volatile Engineering Corporation at the beginning of…

A: The Time-Weighted Rate of Return is a technique that measures an investment portfolio's performance…

Q: You purchased 200 shares of a stock trading at $45 per share and used $6,000 of your own money and…

A: Variables in the question:No. of shares purchased=200Purchase price per share=$45Own…

Q: (a) Suppose you decide to short sell some GameStop shares. Their cu rent price is $5, and you have…

A: Long position means that you think prices will go up and going short means you believe that prices…

Q: uppose that Nintendo Co., Ltd. (NTDOY) is currently trading at $180 per share. Mark buys 200 shares,…

A: Brokers provide margins to client for trading and so that they can trade more and so that client and…

Q: Suppose that XTel currently is selling at $60 per share. You buy 1,000 shares using $48,000 of your…

A: Rate of return on investment (ROI) is a financial metric used to evaluate the profitability of an…

Q: Suppose we purchase a share of IBM for $120 and hold for 1 year. We receive a dividend of $4 and…

A: YTM is also known as Yield to maturity. It is a capital budgeting technique which helps in decision…

Q: Assume you purchased 2000 shares of XYZ common stock on margin at $ 30 per share from your broker .…

A: Interest amount will be computed by finding the leverage amount taken from the broker.

Q: What is the rate of return when 30 shares of Stock A, purchased for $15/share, are sold for $480?…

A: Rate of return = Net income/investment Net income = sales proceeds - investment Sales proceeds =…

Financial Ratios

A Ratio refers to a figure calculated as a reference to the relationship of two or more numbers and can be expressed as a fraction, proportion, percentage, or the number of times. When the number is determined by taking two accounting numbers derived from the financial statements, it is termed as the accounting ratio.

Return on Equity

The Return on Equity (RoE) is a measure of the profitability of a business concerning the funds by its stockholders/shareholders. ROE is a metric used generally to determine how well the company utilizes its funds provided by the equity shareholders.