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Suppose an investor initially pays $6,000 toward the purchase of $10,000 worth of stock (100 shares at $100), borrowing the remaining $4,000 from a broker.
Suppose an investor initially pays $6,000 toward the purchase of $10,000 worth of stock (100 shares at $100), borrowing the remaining $4,000 from a broker. Suppose the maintenance margin is 20%. How far can the stock price fall before the investor gets a margin call? a) $45 b) $40 c) $50 d) $55
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