Question

You have a brokerage account in which you hold equity stocks with a balance of $5250....

  1. You have a brokerage account in which you hold equity stocks with a balance of $5250. You purchase Microsoft at $52.50 per share. Your initial margin is 50%. The following week the price of Microsoft falls to $42. Your maintenance margin is 35%

a) Will you receive a margin call?

b) At what price does a margin call kick in?

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ANSWER IN THE IMAGE ((YELLOW HIGHLIGHTED). FEEL FREE TO ASK ANY DOUBTS. THUMBS UP PLEASE.

NO, YOU WILL NOT RECEIVE A MARGIN CALL, margin call kick in at PRICE OF 40.38

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