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please show all work and provide formulas Stan sold short 100 shares at $40 per share. The initial margin requirement is 70%, and the maintenance
please show all work and provide formulas
Stan sold short 100 shares at $40 per share. The initial margin requirement is 70%, and the maintenance margin is 40%. 1. Calculate Stan's required performance bond (deposit). 2. Use a T-account to summarize the status of Stan's account immediately after shorting the stock. 3. How would Stan's account look if the stock price decreased to $32 ? A. Calculate the percentage change in the value of the stock and Stan's HPR. Are short sales leveraged? B. Calculate Stan's actual margin. 4. How would Stan's account look if the stock price increased to $62 ? A. Calculate the percentage change in the value of the stock and Stan's HPR. B. Calculate Stan's actual margin. Will Stan receive a margin call? C. How much cash would Stan have to deposit to increase the margin to its maintenance level? 5. Reconsider how the account looked immediately after Stan opened it. What is the lowest price that would trigger a margin call Step by Step Solution
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