1. After observing your returns for April, you felt confident that prices would continue to rise. Suppose you bought 200 shares of DIS Stock on margin on April 30.

a. Calculate the market value of your stock purchase using your rounded prices from the table below.

b. Using the maximum allowable margin, calculate how much money you had to borrow from your broker.

c. Calculate the price at which you would receive a margin call if the maintenance margin is 25%.

d. Be sure to write the formula that you use to make the calculation.

e. Write your answer with 2 decimal places (for example, $42.86).

f. Calculate your profit assuming you closed your margin position on May 29 by selling your stock and your broker charged you 1% interest on the loan.

g. Calculate your return. Round to the nearest whole number.

h. Compare your return to buying on margin to not buying on margin. A simple statement like 40%>20% works.

2. After observing your returns for May, you began to feel more pessimistic. Suppose you decided to short 100 shares of DIS Stock on May 29.

a. Calculate the proceeds from your initial sale of the stock using your rounded prices from the table below.

b. Using the maximum allowable margin, calculate how much collateral you need in your brokerage account.

c. Calculate the price at which you would receive a margin call if the maintenance margin is 25%.

d. Be sure to write the formula that you use to make the calculation.

e. Write your answer with 2 decimal places (for example, $42.86).

f. Calculate your profit assuming you closed your short position on June 30 by purchasing shares. You may assume your stock did not pay any dividends.

g. Calculate your return. Round to the nearest whole number.

Date/Month Stock Ticker Shares Outstanding (Millions) Price The Walt Disney Company DIS 1,810 M 97 108 3/31/2020 4/30/2020 5/29/2020 6/30/2020 117 112 Returns April May June 11% 8% (4%) Date/Month Stock Ticker Shares Outstanding (Millions) Price The Walt Disney Company DIS 1,810 M 97 108 3/31/2020 4/30/2020 5/29/2020 6/30/2020 117 112 Returns April May June 11% 8% (4%)