Suppose that an investor sells 400 shares short at $50 per share. The initial margin is 50% and the maintenance margin is 30%. After 125 days, the investor purchases the shares for $40 and closes the short position. During the holding period, the shares paid a dividend of $2.50 per share. Show the calculations for the numbers that you enter in the T accounts.

a. Show the investors beginning T account. (calcs here)

b. At what price would the investor receive a margin call?

c. Show the investors T account at the share price of $40. (calcs. here)

d. What is the actual margin at a share price of $40? e. Calculate the investors return for the 125 day holding period.