Please Answer B & C

Question 2 (5 marks) Suppose you are bearish on CBA and decide to sell short 100 shares at the current market price of $50 per share. If the broker's initial margin requirement is 50% of the value of the short position and the maintenance margin is 30%. a) How much in cash or securities must you put into your brokerage account? Number of shares you decide to short = 100 Price per share= $50 Total price = 100 x 50 = $5000 The broker's initial margin requirement is 50% of shorted position So required initial margin= 50% of 5000 = $2500.00 b) If the price of CBA immediately changes to: (i) $54; (ii) $60; (iii) $64, will you receive a marginal call? If so, please calculate the additional margin you need to deposit in the account = c) How high can CBA's price increase before you get a margin call? Question 2 (5 marks) Suppose you are bearish on CBA and decide to sell short 100 shares at the current market price of $50 per share. If the broker's initial margin requirement is 50% of the value of the short position and the maintenance margin is 30%. a) How much in cash or securities must you put into your brokerage account? Number of shares you decide to short = 100 Price per share= $50 Total price = 100 x 50 = $5000 The broker's initial margin requirement is 50% of shorted position So required initial margin= 50% of 5000 = $2500.00 b) If the price of CBA immediately changes to: (i) $54; (ii) $60; (iii) $64, will you receive a marginal call? If so, please calculate the additional margin you need to deposit in the account = c) How high can CBA's price increase before you get a margin call