Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

just need the answer for question A and question B-1, please show work if possible really stuck. Old Economy Traders opened an account to short-sell

just need the answer for question A and question B-1, please show work if possible really stuck.
image text in transcribed
Old Economy Traders opened an account to short-sell 1,000 shares of Internet Dreams at $40 per share. The initial margin requirement was 50% (The margin account pays no interest) 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 Required: a. What is the remaining margin in the account? Remaining margin 1-1. What is the margin on the short position? Short margin 5-2 it the maintenance margin requirement is 30%, will Old Economy receive a margin call Yes O NO c. What is the rate of return on the investment? (Negative value should be indicated by a minus sign.) torem

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_2

Step: 3

blur-text-image_3

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

How To Create Your Own Erc20 Cryptocurrency On Polygon

Authors: Praveen Soundarajan ,Keerthana Buvaneshwaran

1st Edition

979-8464850132

More Books

Students also viewed these Finance questions

Question

What is goal congruence?

Answered: 1 week ago