Old Economy Traders opened an account to short-sell 1,000 shares of Internet Dreams at $75 per share.
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Question:
Old Economy Traders opened an account to short-sell 1,000 shares of Internet Dreams at $75 per share. The initial margin requirement was 50%. (The margin account pays no interest.) A year later, the price of Internet Dreams has risen from $75 to $89.50, and the stock has paid a dividend of $11.00 per share.
a. What is the remaining margin in the account?
Remaining margin $
b-1. What is the margin on the short position? (Round your answer to 2 decimal places.)
Short margin %
b-2. If the maintenance margin requirement is 30%, will Old Economy receive a margin call?
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