Question

**Use the following information to solve for FOUR
QUESTIONS BELOW. USE AT LEAST 4 DECIMALS FOR ACCURATE
RESULTS.**

Six months ago, you purchased 500 shares of stock on margin. The initial margin requirement on your account is 60% and the maintenance margin is 40%. The call money rate plus the spread is 4.7%. The purchase price was $15 per share. Today, you sold these shares for $18 each.

**#1) How much did you borrow? That is, what is the margin
loan?**

**#2) What is your new margin?**

**#3) What is your Effective Annual Return
(EAR)?**

**#4) At what price (P*) would you receive a margin
call?**

#1) MARGIN LOAN = $3,000 |
||

#1) MARGIN LOAN = $4,500 |
||

#1) MARGIN LOAN = $6,000 |
||

#1) MARGIN LOAN = $7,500 |
||

#2) NEW MARGIN = 43.43% |
||

#2) NEW MARGIN = 55.55% |
||

#2) NEW MARGIN = 66.67% |
||

#2) NEW MARGIN = 72.72% |
||

#3) EAR = 11.22% |
||

#3) EAR = 33.35% |
||

#3) EAR = 43.45% |
||

#3) EAR = 73.67% |
||

#4) Price that would lead to margin call = $8.5 or lower |
||

#4) Price that would lead to margin call = $10 or lower |
||

#4) Price that would lead to margin call = $11.5 or lower |
||

#4) Price that would lead to margin call = $14 or lower |

Answer #1

You have just borrowed $67,500 on margin to buy shares in ABC,
which is currently quoting as the bid price of $29.99 bid and the
ask price of $30.00 ask per share. The minimum margin is 35%, and
your initial margin requirement is 55%. Assume that ABC will pay no
dividends before you return the loan and that that you pay no
interest on your loan.
If you buy ABC in margin, what is the maximum number of shares
you...

The price of Facebook stock is currently at $56.51 and you
decide to buy 100 shares on margin. You borrow $1,500 from your
broker and finance the remainder of the purchase with your own
cash. I need help with #2 & #3
1.What is your margin (as a decimal value)?
(56.51*100-1,500)/(56.51*100)=0.735
2.If the price rises to $60, and the interest you have to pay on
the broker's loan is 4%, what is the net return (as a decimal
value)?
3.If...

Solve the problem below:
Use this information for questions 1-4:
Boucher Service Company’s EPS is $3.00. The payout rate is 60%, the
growth rate of earnings and dividends is 4%, and required return on
equity is 7%. Boucher’s ROE is 10% and the firm’s net profit margin
(NPM) is 5%. Assume the constant growth model is appropriate.
What is Boucher’s justified price/sales ratio (P0/S0)?

Use the information below to answer the following questions.
After taking an aliquot of J558 suspension cells from your T75
culture flask, you dilute this aliquot in Trypan Blue in a 1:1
ratio. After loading the cells on the hemocytometer you obtain the
following counts:
Transparent cells
Blue cells
Quadrant 1
32
1
Quadrant 2
31
1
Quadrant 3
30
1
Quadrant 4
31
2
Quadrant 5
33
1
1) What is the cell viability?
2) What is the density...

You just bought 200 shares of a stock priced at $48 per share
using 50% initial margin. The broker charges 4% annual interest
rate on the margin loan and requires a 30% maintenance
margin. One year later stock price dropped to 31 and you
recieved margin call, to restore your margin to the initial margin
level, how much would you need to deposit?
Answer ___+/- ____
You sell short 100 shares of company A which are currently
selling at $32 per...

Required information
[The following information applies to the questions
displayed below.]
NOTE: Throughout this lab, every time a screenshot is
requested, use your computer's screenshot tool, and paste each
screenshot to the same Word document. Label each screenshot in
accordance to what is noted in the lab. This document with all of
the screenshots included should be uploaded through Connect as a
Word or PDF document when you have reached the final step of the
lab.
In this lab, you...

Suppose that Xtel currently is selling at $56 per share. You buy
500 shares using $20,000 of your own money, borrowing the remainder
of the purchase price from your broker. The rate on the margin loan
is 6%.
a. What is the percentage increase in the net
worth of your brokerage account if the price of Xtel
immediately changes to: (i) $58.80; (ii) $56; (iii)
$53.20? What is the relationship between your percentage return and
the percentage change in the...

Use the following information to answer questions #1 – 3: A
monopolist has the following demand curve: P = 100 – Q and total
cost curve: TC = 16 + Q2 and marginal cost curve: MC = 2Q.
1. Find the profit maximizing quantity. a. Q = 20 b. Q = 33.33
c. Q = 25 d. Q = 4 e. Q = 30
2. Find the profit maximizing price. a. $96 b. $80 c. $75 d.
$66.67 e. $70...

Could you answer the question below with some work?
Use this information for questions 1-4:
Boucher Service Company’s EPS is $3.00. The payout rate is 60%, the
growth rate of earnings and dividends is 4%, and required return on
equity is 7%. Boucher’s ROE is 10% and the firm’s net profit margin
(NPM) is 5%. Assume the constant growth model is appropriate.
What is Boucher’s justified price/book ratio (P0/B0)? (Enter
your answer to the nearest 0.01.)

1)
You sell short 200 shares of Doggie Treats Inc. that are currently
selling at $25 per share. You post the 50% margin required on the
short sale. If your broker requires a 30% maintenance margin, at
what stock price will you get a margin call? (You earn no interest
on the funds in your margin account, and the firm does not pay any
dividends.)
A.
$32.25
B.
$31.50
C.
$28.85
D.
$35.71
2) You purchased 250 shares of common...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 11 minutes ago

asked 26 minutes ago

asked 40 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago