PART A:

You recently purchased 200 shares of stock at a cost per share of $23.50. The initial margin requirement on this stock is 75% and the maintenance margin is 50%. The stock is currently valued at $25.00 a share. What is your current margin position? Ignore margin interest.

Multiple Choice

• 73.83%

• 76.50%

• 76.79%

• 74.40%

• 73.01%

PART B

You purchased five call option contracts with a strike price of $22.50 and an option premium of $.48. You held the option until the expiration date. On the expiration date, the stock was selling for $21.70 a share. What is the total profit or loss on your option position?

Multiple Choice

• $120

• $0

• $240

• $45

• $135

PART C

Which one of the following describes a short position?

Multiple Choice

• Purchasing a security on margin

• Loaning a security to your broker to cover a margin call

• Selling a security that you originally purchased on margin

• Selling a security that you do not own

• Having less equity than required in your margin account