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QUESTION 10 You purchase 1,000 shares of Pfizer (PFE) at $35 per share by giving your broker $20,000 to establish your margin account. After a
QUESTION 10 You purchase 1,000 shares of Pfizer (PFE) at $35 per share by giving your broker $20,000 to establish your margin account. After a year (t=1), PFE paid out a dividend of $2 per share. The rate on the margin loan is 8%. If you earn no interest on the funds in your margin account, what is PFE's price at which you will receive a margin call? A. $18.93 B. $51.07 C. $26.83 D. $44.38 QUESTION 10 You purchase 1,000 shares of Pfizer (PFE) at $35 per share by giving your broker $20,000 to establish your margin account. After a year (t=1), PFE paid out a dividend of $2 per share. The rate on the margin loan is 8%. If you earn no interest on the funds in your margin account, what is PFE's price at which you will receive a margin call? A. $18.93 B. $51.07 C. $26.83 D. $44.38
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