1. An investor opens a brokerage account and purchase 100 shares of ABC Inc. at...
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1. An investor opens a brokerage account and purchase 100 shares of ABC Inc. at $70 per share. She borrows $2,000 from her broker to help pay for the purchase. The interest rate on the loan is 10%. a) What is the margin in this investor's account when she first purchases the stock? b) If the stock price falls to $50 per share by the end of the year, what is the remaining margin in her account? C) What is the rate of return on her investment? 2. An investor expects that XYZ Inc. stock price will fall, and he decides to sell short 150 shares of XYZ Inc. at the current market price of $70 per share. If the stock price falls to $50 per share, what is the amount of this investor's profit
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