The current S&R index futures price is 1100. You have purchased 8 contracts on margin. The initial margin is 10%. The size of each futures contract is $250 times index level.

(a) What is the initial margin of your position?

(b) Suppose you can earn an effective interest rate of 0.1% per week in the margin account. Your profit/loss is marked to market weekly. The maintenance margin is 80% of the initial margin. What is the balance of your margin if the S&R index futures price dropped to 1070?