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ART I Introduction 7. Old Economy Traders opened an account to short sell 1,000 shares of Internet Dreams from the previous problem. The initial margin

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ART I Introduction 7. Old Economy Traders opened an account to short sell 1,000 shares of Internet Dreams from the previous problem. "The initial margin requirement was 50%. (The margin account pays no inter- est.) A year later, the price of Internet Dreams has risen from $40 to $50, and the stock has paid a dividend of $2 per share. a. What is the remaining margin in the account? If the maintenance margin requirement is 30%, will Old Economy receive a margin call? What is the rate of returm on the investment? c

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