1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Vinil7 [7]
3 years ago
10

You are bullish on Stock A. The current market price is $67 per share, and you wish to purchase 200 shares. Your plan is to borr

ow at the maximum possible amount allowed under the initial margin requirement of 50%. How far does the price of Telecom stock have to fall for you to get a margin call if the maintenance margin is 26%?
Business
1 answer:
Vikentia [17]3 years ago
7 0

Answer:

The Margin call will be made at $50.92

Explanation:

Initial Margin per share = Price*Margin requirement

Initial Margin per share = $67*50%

Initial Margin per share = $33.50

Maintenance Margin per share = $67 * 26% = $17.42

Hence, the loss allowed = Initial Margin per share - Maintenance Margin per share =  $33.50 - $17.42 = $16.08

Hence, the price of a share can fall up to $50.92 (i.e. $67-$16.08) before getting a margin call. Thus, the Margin call will be made at $50.92

You might be interested in
Temporary investments such as in trading securities are a.recorded at fair market value and reported at fair market value b.reco
g100num [7]

Answer:

The correct answer is b.recorded at cost but reported at fair market value.

Explanation:

Investments represented in shares and in shares or shares of social interest will be recorded at their historical cost. Other investments, such as bonds, bonds, certificates, etc., will be accounted for at their nominal value. However, in case of differences between the latter and the historical cost, with the purpose of not breaking the basic accounting standard of "valuation or measurement", such differences will be controlled through complementary valuation auxiliary accounts of the investment, specifically in the titles in which the difference is presented. For this purpose, the discount items for amortization or premium for amortization will be used.

6 0
3 years ago
What is the opportunity cost of producing more shoes?
jeka94
Produce less watermelon
6 0
2 years ago
The majority of private sector employment in the u.s. economy is in the
sasho [114]
The majority of private sector employment in the u.s. economy is in the services.
The private sector is the part of the economy, generally pertain to as the citizen sector. Which is ruled by private individuals or groups, usually as a means of firm for profit and it is not regulated by the State.
6 0
3 years ago
Lee Airlines plans to issue 12-year bonds with a par value of $1,000 that will pay $70 every six months. The bonds have a market
Zielflug [23.3K]

Answer:

After tax cost of debt = 10.43%

Explanation:

Market price = 960

Flotation cost = 0.07

Market price after Flotation cost = 960*(1-0.07) = 960*0.93 = 892.8

Face value = 1,000

Interest payment (PMT) = 1000*0.07 = 70

Term of payment = 12*2 = 24

Cost of debt before tax = Rate(24, 70, -892.8, 1000, 0)*2

Cost of debt before tax = 0.080198497*2

Cost of debt before tax = 0.160396994

Cost of debt before tax = 16.04%

Tax rate = 35%

After tax cost of debt = 16.04% * (1-35%)

After tax cost of debt = 0.1604*0.65

After tax cost of debt = 0.10426

After tax cost of debt = 10.43%

6 0
3 years ago
Drag the tiles to the correct understand the different types of life insurances
VashaNatasha [74]

1.plan that earns tax-deferred interest income and has high risk

d. guarantee universal life

2.plan that builds wealth and pays a death benefit

a. term life

3.plan that covers a family while the person is employed

b. index universal life

4.plan that covers someone for his or her life

c. whole life

3 0
3 years ago
Read 2 more answers
Other questions:
  • Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of office expenses a
    5·1 answer
  • A corporation issued $600,000, 10%, 5-year bonds on January 1, 2017 for $648,666, which reflects an effective-interest rate of 7
    12·1 answer
  • Newland and Palermo form a partnership. Newland contributes land with a book value of $50,000 and a fair value of $60,000. Newla
    7·1 answer
  • Standard of living includes _____, which can be bought and sold.
    5·1 answer
  • Selections, a general partnership, operates a gift shop. Selections has five partners. Tony has a one-third interest in the part
    10·1 answer
  • Suppose that a country experiences growth strongly biased toward its export, cloth, Group of answer choices this will tend to im
    9·1 answer
  • Approximately how much of what employees know about their work is attributable to formal organizational training?
    10·1 answer
  • he accounting records of Baddour Company provided the data below. Net loss $ 4,350 Depreciation expense 6,320 Increase in salari
    6·1 answer
  • Bailey Corporation. incurred 2,300 direct labor hours to produce 600 units of product. Each unit should take 4 direct labor hour
    10·1 answer
  • An airline has a marginal cost per passenger of $20 on a route from Detroit to New Orleans. At the same time, the typical fare c
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!