Suppose that XTel currently is selling at $40 per share. You buy800 shares using $25,600 of your own money, borrowing the remainderof the purchase price from your broker. The rate on the margin loanis 10%.

a. What is the percentage increase in the networth of your brokerage account if the price of XTelimmediately changes to (a) $44; (b) $40; (c) $36?(Leave no cells blank - be certain to enter "0" whereverrequired. Negative values should be indicated by a minus sign.Round your answers to 2 decimal places.)

a. Percentage gain	_____%
b. Percentage gain	_____%
c. Percentage gain	_____%

b. If the maintenance margin is 20%, how lowcan XTel’s price fall before you get a margin call? (Roundyour answer to 2 decimal places.)

Price

_____

c. How would your answer to requirement 2 wouldchange if you had financed the initial purchase with only $16,000of your own money? (Round your answer to 2 decimalplaces.)

Strike Price

______

d. What is the rate of return on your marginedposition (assuming again that you invest $25,600 of your own money)if XTel is selling after one year at (a) $44; (b) $40; (c)$36? (Negative values should be indicated by a minus sign.Round your answers to 2 decimal places.)

a. Rate of return	______%
b. Rate of return	______%
c. Rate of return	______%

e. Continue to assume that a year has passed.How low can XTel’s price fall before you get a margin call?(Round your answer to 2 decimal places.)

Price

______