Question
An investor to buys Schlumberger Limited (SLB) share at $15 per share using $90,000 of his own money and a margin loan. a. With an
An investor to buys Schlumberger Limited (SLB) share at $15 per share using $90,000 of his own money and a margin loan.
a. With an initial margin of 50% what is the maximum number of shares he can buy?
b. If the maintenance margin is 20%, at what price will he get a margin call? And how much money would he need to add?
c. If SLB stock price rises to $18, can the investor withdraw fund from the account? If so, how much can he withdraw?
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Essential Mathematics For Economic Analysis
Authors: Knut Sydsaeter, Peter Hammond
3rd Edition
0273713248, 9780273713241
