Question 4 (21 Marks) Suppose that NAT currently is selling at $80 per share. You buy 500 shares using $30,000 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 change in the net worth of your margin account if the price of NAT immediately changes to: i. $88 ii. $80 iii. $72 Show all your calculations for each of the above case (i) to (iii). 6 marks b. If the maintenance margin is 25%, how far can NAT's price fall before you will get a margin call? Show all your calculations. 3 marks C. How would your answer to (b) change if you had financed the initial purchase of NAT with only $20,000 of your own money? Show all your calculations. 3 marks d. What is the rate of return on your margined position (assuming that you invest $30,000 of your own money) if NAT is selling after one year at: i. 88 ii. 80 iii. 72 6 marks Continue to assume that a year has passed and your initial investment is $30,000. How far can NAT's price fall before you get a margin call if the maintenance margin is 25%? 3 marks e