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IMR 0 . 5 0 MMR 0 . 3 0 Call rate 0 . 0 7 2 5 Shares 1 , 0 0 0 Aramark

IMR 0.50 MMR 0.30 Call rate 0.0725 Shares 1,000
Aramark
Purchase price, 9/1/20 $19.10
Sales price, 9/1/23 $25.05
Assume you bought the stock on 9/1/20.
1. How much did you have to have in your account before you purchased the stock?
Assume you sold the stock on 9/1/23.
2. How much did you pay in interest?
3. What was your total loan repayment?
4. What was your net cash inflow?
5. What was your return?
Assume you didnt sell the stock on 9/1/23.
6. How low could the stock go before you got a margin call?
7. Suppose the price drops to $60 a share. Would you get a margin call, and if so,
what would be the amount?
8. Suppose the price drops 20% from the lowest price without a margin call. What
is your actual margin?
9. What is your margin call amount?
Assume you meet the margin call.
10. What will your equity be after you meet the call?
Assume you cant meet the margin call.
11. What is the maximum market value you can have?
12. What is the reduction needed?
13. How many shares will your broker sell?
14. What is the actual reduction?
15. What is the value of your stock after your broker has sold the stock?
16. What is the value of your loan after your broker has sold the stock?

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