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An investor sells 100 shares short at $50. The sale requires an initial margin deposit equal to 60 percent of the proceeds of the sale
An investor sells 100 shares short at $50. The sale requires an initial margin deposit equal to 60 percent of the proceeds of the sale and maintenance margin is 40%. If the stock price increases to $66: a) what are investors options regarding this position; b) if investor chooses to close position at this point, what will be the percentage return on the investment?
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