the call money rate is 6.8 percent, and you pay a spread of 1.9 percent over that. You buy 1,300 shares at $93 per share with an initial margin of 55 percent. One year later, the stock is selling for $101 per share and you close out your position.

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A: Formulas:

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

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Q: Suppose the call money rate is 6.8 percent, and you pay a spread of 1.9 percent over that. You buy…

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

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A: Margin call refers to the amount which is deficit to maintain the maintenance margin account.

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