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You think Esterline's stock is going to go up in value this month. The current stock price is $25 per share and you have $4,500
You think Esterline's stock is going to go up in value this month. The current stock price is $25 per share and you have $4,500 of your own money to invest. You borrow an additional $4,500 from your broker and then invest the $9,000 in the stock. Assume Esterline does not pay dividends and that the broker is offering a temporary promotion so there is no fee or interest for lending you the $4,500 this month. If Esterline's stock price decreases, at what price would you first get a margin call if the maintenance margin is 33% and the initial margin is at least 50% ? Select the price closest to the correct answer. $17.86 $18.66 $14.29 $14.93
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