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Please show formulas!!! Suppose that Intel currently is selling at $40 per share. You buy 500 shares using $15,000 of your own money, borrowing the

Please show formulas!!!

Suppose that Intel currently is selling at $40 per share. You buy 500 shares using $15,000 of your own money, borrowing the remainder of the purchase price from your broker. The rate on the margin loan is 8%. a. What is the percentage increase in the net worth of your brokerage account if the price of Intel immediately changes to (i) $44; (ii) $40; (iii) $36? What is the relationship between your percentage return and the percentage change in the price of Intel? b. If the maintenance margin is 25%, how low can Intel's price fall before you get a margin call? c. How would your answer to (b) change if you had financed the initial purchase with only $10,000 of your own money? d. What is the rate of return on your margined position (assuming again that you invest $15,000 of your own money) if Intel is selling after one year at (i) $44; (ii) $40; (iii) $36? What is the relationship between your percentage return and the percentage change in the price of Intel? Assume that Intel pays no dividends. e. Continue to assume that a year has passed. How low can Intel's price fall before you get a margin call?
Data Input
Initial share price $40.00
Shares purchases 500
Equity $15,000.00
Interest rate 8%
Maintenance margin 25%
Borrowed funds $5,000.00
initial percentage equity -32.60869565 0.75
a.
i. New stock price = $44.00 What is the relationship between your percentage return and the percentage change in the price of Intel? It increases the return when there is a positive return. However it will also enhance your loss making your loss bigger.
Profit = $2,000.00
Percentage change of net worth (percentage return) 13.33%
ii. New stock price = $40.00
Profit =
Percentage change of net worth (percentage return)
iii. New stock price = $36.00 c.
Initial share price 40
Profit = Shares purchases 500
Percentage change of net worth (percentage return) Equity 10000
Interest rate 8.00%
b. Margin call price = $0.00 Maintenance margin 25.00%
d. Borrowed funds = 10000
i. New stock price = $44.00 Margin call price = 9875 ?
interest = 400 400
profit = $2,000.00 1600
Rate of return = 13.33% 10.67 e.
Margin call price =
ii. New stock price = $40.00
interest =
profit =
Rate of return =
iii. New stock price = $36.00
interest =
profit =
Rate of return =

PLEASE DONT SOLVE
DONT NEED ANYMORE

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