Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Bill Gates has decided to take a short position in Tesla stock at $ 1 , 0 0 0 per share. He sells 1 0

Bill Gates has decided to take a short position in Tesla stock at $1,000 per share. He sells 100 shares short at $1,000 per share. The following information applies for short sales:
IMR =50% MMR =30%
d) How much does Bill have to deposit in his account after taking the short position? Show a balance sheet of the account after the short sale e) At what price would Bill double the value of his investment? (2 points)
f) By what percentage would the price have to rise for Bill to be subject to a margin call? (1 point)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Oxford Handbook Of Entrepreneurial Finance

Authors: Douglas Cumming

1st Edition

0195391241, 978-0195391244

More Books

Students also viewed these Finance questions

Question

1. Send a brief note thanking the family members for attending.

Answered: 1 week ago

Question

4. Explain the strengths and weaknesses of each approach.

Answered: 1 week ago

Question

3. Identify the methods used within each of the three approaches.

Answered: 1 week ago