3. Suppose Y Corp stock is trading at $100 per share. You think the stock price will fall in the future thus interested in shorting it. The initial margin requirement is 50% and maintenance margin requirement is 30%. You short 100 shares now.

(a) Construct your initial balance sheet and state how much money you have to put up in your account according to the initial margin requirement.

(b) One month later the stock price went up to $110. Construct your new balance sheet and calculate your margin percentage and state whether you will receive a margin call.

(c) How far can the stock price rise before receiving a margin call from your broker?