Question
The stock price of Google is $565. a. You think the stock price will go down soon, and want to trade 20 shares. What should
The stock price of Google is $565.
a. You think the stock price will go down soon, and want to trade 20 shares. What should you do? Enter 20 for buying 20 shares (on margin if necessary), or -20 for selling or short-selling 20 shares.
b. If the initial margin is 50%, what is the minimum additional dollar amount that you have to deposit from your own funds to your brokerage account?
c. If you contribute the amount above (your answer to Part 2), what is your initial percentage margin (entered as a decimal number)?
d. Two months later, the stock price is $585. Google paid a dividend of $11 per share just before the two months were over. What is your percentage margin (entered as a decimal number)?
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