Eagleway built a short position of 1,000 shares of stock when the underlying stock price was $50 a share. Eagleway expected the stock price would drop to $20 a share in 12 months. Eagleway needed to put up collateral with value equal to 102% of the borrowed position. The lending fee is $0.02 a share per calendar day. In total, what is Eagleway's lending fee in 12 months (360 day calendar year)?

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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Chapter1: Investments: Background And Issues
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Ay 3. Eagleway built a short position of 1,000 shares of stock when the underlying stock price was $50 a share. Eagleway expected the stock price would drop to $20 a share in 12 months. Eagleway needed to put up collateral with value equal to 102% of the borrowed position. The lending fee is $0.02 a share per calendar day. In total, what is Eagleway's lending fee in 12 months (360 day calendar year)?
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