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Suppose an investor is pessimistic about the Caterpillar (NYSE CAT) stock. She prepares to sell short 100 shares of common stocks. The current selling price

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Suppose an investor is pessimistic about the Caterpillar (NYSE CAT) stock. She prepares to sell short 100 shares of common stocks. The current selling price of the stock is $150. The requirement for initial margin is 50% and the account requires a 40% maintenance margin. What will be the stock price that triggers a margin call? 1 Question 2 (10 points) An investor is interested in selling a T-bill which is quoted with a 3.75% ask yield and a 3.95% bid yield. The bill has 80 days until maturity. What will be the price that the investor could sell for? (note that Treasury bill has a $10,000 face value and uses bank discount rate method)

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