You sell short 150 shares of Microsoft that are currently selling at $300 per share. You post the 50% margin (cash buffer) required on the short sale. The broker charges you interest of 6%. Answer the following questions:

A. What is the amount of cash you put in as buffer?

B. If the maintenance margin is 35%, what is the price of Microsoft stock above which you will get a margin call? Ignore interests and dividends.

C. Calculate your rate of return after 1 year if Microsoft stock is selling at $350? (Ignore any dividends.)