Use the following to answer the next four questions

One year ago today, Mike bought 1000 shares of Umbrella stock for $90/share on 55% margin. Mike's broker charged a 7% annual interest rate on borrowed funds and set the maintenance margin level at 40%. Today, Mike closed his position when the stock sold for $87/share.

How much equity did Mike have to place into his account the day he opened it?

		$36000
		$40500
		$90000
		$54000
		None of the above

b/ Find Mike's ROIC. Round intermediate steps and your final answer to four decimals. Enter your answer in decimal format (EX: .XXXX)

c/

What would have been Mike's ROIC if he invested in the stock without using margin? Round intermediate steps to four decimals.

		.0333
		-.0333
		-.0606
		None of the above

d/

What is the lowest possible price that the stock can trade for before a margin call is issued?

		82.5
		35.36
		28.93
		67.5
		None of the above

d/