Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. you borrowed $25240 six months ago at 8.4% ear to

You borrowed $25240 six months ago at 8.4% EAR to finance the purchase of $79431...

60.1K

Verified Solution

Question

Finance

image

You borrowed $25240 six months ago at 8.4% EAR to finance the purchase of $79431 of stock. Assuming your maintenance margin requirement is 10% and that interest is computed on the loan daily (but paid only when the position closes), how much can the stock price decline (%) from your purchase price before triggering a margin call? When giving your answer please write in whole numbers. That is, if the stock may fall 10.5% please write 10.5

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

From the list below select all FALSE propositions M x E ZI 2 x 2...

Accounting
1.2K views

(10 pts) Barley Company owns a plot of land on which buriedtoxic wasteshave been...(10...

Finance
1.2K views

Bill Clinton reportedly was paid $ 15.0 million to write his book My Life. The book...

Statistics
1.2K views

Below is the data for a personality questionnaire measuring conscientiousness. These data were taken from a...

Mechanical Engineering
1.2K views

In what ways can firms using SaaS products dramatically lower costs associated with their information systems? Give...

General Management
1.2K views

The executive team of a Multinational Corporation (MNC) is interested in expanding into a host country....

Advance Math
1.2K views

Describe two bounded and two unbounded models for hyperbolic geometry. Draw pictures for each model to...

Calculus
1.2K views

lim 2 3y2 54 44 Y D 1 1 20 viin min b 3

Algebra
1.2K views

An account is opened with an initial deposit of 100 and earns 3 0 interest...

Algebra
1.2K views

have 228 feet of fencing to enclose a rectangular region Find the dimensions of the...

Accounting
1.2K views

Calculate Net Income in each separate scenario: Total Assets Total Liabilities ...

Accounting
1.2K views

Problem 2-5 Balance sheets for Salt Company and Pepper Company on December 31, 2013, follow:...