You invested in 800 shares of stock for $49.20 a share. The initial margin requirement is 65 percent and the maintenance margin is 35 percent. What is the lowest the stock price can go before you receive a margin call? What is the lowest the stock price can go before you receive a margin call if both the initial and maintenance margins are 100%? What is the lowest the stock price can go before you receive a margin call if both the initial and maintenance margins are 0%?
You invested in 800 shares of stock for $49.20 a share. The initial margin requirement is 65 percent and the maintenance margin is 35 percent. What is the lowest the stock price can go before you receive a margin call? What is the lowest the stock price can go before you receive a margin call if both the initial and maintenance margins are 100%? What is the lowest the stock price can go before you receive a margin call if both the initial and maintenance margins are 0%?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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You invested in 800 shares of stock for $49.20 a share. The initial margin requirement is 65 percent and the maintenance margin is 35 percent.
What is the lowest the stock price can go before you receive a margin call?
What is the lowest the stock price can go before you receive a margin call if both the initial and maintenance margins are 100%?
What is the lowest the stock price can go before you receive a margin call if both the initial and maintenance margins are 0%?
How would your answers to the three questions above change if you invested in 8000 shares instead of 800 shares?
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