You short 150 shares worth $7,500. Your initial margin is 60%. Your maintenance

margin requirement (MMR) is 30%. Ignore transaction costs and interest costs in your

calculations.

(a) What is the total dollar value of your starting assets?

(b) If the price increases to $60, what is the new margin percentage?

(c) Say the price increases to $60 and the stock pays $2 dividend. How should that

change your new margin percentage (higher, lower, or the same)? Explain.

(d) At what price would a margin call occur?