Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. 1. the price of facebook stock is currently $43.18

1. The price of Facebook stock is currently $43.18 and you decide to buy 170...

90.2K

Verified Solution

Question

Finance

1. The price of Facebook stock is currently $43.18 and you decide to buy 170 shares on margin. The inital margin is 60%.

a. How much money will you borrow from the broker if you borrow as much as possible?

b. If the price falls to $38.72, what is the new percentage margin in the account?

c. If the broker's maintenance margin is 40%, what is the minimum value the stock price can take before you are issued a margin call?

2. The stock price of Apple is $106. You have $10,000 to invest. The monthly interest rate is 0.5%.

a. You think the stock price will go up soon, and want to trade 120 shares. What should you do? Enter 120 for buying 120 shares (on margin if necessary), or -120 for selling or short-selling 120 shares.

b. What is your initial percentage margin (entered as a decimal number)?

c. Two months later, the stock price is $126. What is your percentage margin (entered as a decimal number)?

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Basic Math
1.2K views

Consider a hyper geometric probability distribution with n=7, R= 8 and N=17 a) calculate P(x =5) b) calculate...

Electrical Engineering
1.2K views

a 240v, 4pole shunt motor running at 1000 r.p.m gives 15 hp with an armature current...

Advance Math
1.2K views

construct a subgroup Lattice of Z 36 & 60

Basic Math
1.2K views

Match each drawing on the left with its correct geometric notation on the right Some...

Basic Math
1.2K views

A football team has enough resources to recruit one player. The players the team is...

Statistics
1.2K views

Out of 600 people sampled 66 preferred Candidate A Based on this estimate what proportion...

Statistics
1.2K views

Suppose a doctor measures the height x and head circumference y of 11 children and...

Calculus
1.2K views

7 B 74 3 a 859 m b 783 m

Algebra
1.2K views

What is an equation in standard form of an ellipse centered at the origin with...

Accounting
1.2K views

The Jones and Brown medical practice bought new equipment for a total price of $50,000....

Accounting
1.2K views

How do you expand Internationally amidst the pandemic

Accounting
1.2K views

Required information The Foundational 15(Static)[LO8-2, LO8-3, LO8-4, LO8-5, LO8-7, LO8-9, LO8-10] [The...