Answered step by step
Verified Expert Solution
Question
1 Approved Answer
1. An investor purchases 2000 shares of a stock with a market price of $48/share on a 50% margin (i.e., takes a 50% cash loan
1. An investor purchases 2000 shares of a stock with a market price of $48/share on a 50% margin (i.e., takes a 50% cash loan from the broker.) The investor is required to maintain a 50% maintenance margin.
A. What is the investor's margin if the price of the stock increase to $53/share?
B. If the price of the stock drops to $43 / share, what is the investor's margin?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started