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7. An investor short sells 350 shares of TLC Telecom that are currently selling for $28 per share. The initial margin and the maintenance margin
7. An investor short sells 350 shares of TLC Telecom that are currently selling for $28 per share. The initial margin and the maintenance margin required by the broker are 50% and 30% respectively. At what stock price will he get a margin call? Assuming that he earns no interest on the funds in his margin account, and the firm does not pay any dividends. * a. $28.85 b. $31.71 c. $36.50 d. $34.25 e. None of the above
7. An investor short sells 350 shares of TLC Telecom that are currently selling for $28 per share. The initial margin and the maintenance margin required by the broker are 50% and 30% respectively. At what stock price will he get a margin call? Assuming that he earns no interest on the funds in his margin account, and the firm does not pay any dividends. *
a. $28.85
b. $31.71
c. $36.50
d. $34.25
e. None of the above
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Mathematics Of Finance
Authors: Robert Brown, Steve Kopp, Petr Zima
8th Edition
0070876460, 978-0070876460
