Question: 4. Margin Trading. You open a margin account and deposit $50,000. You borrow an additional $50,000 from your broker to purchase 2,000 shares of Stock

4. Margin Trading. You open a margin account and deposit $50,000.

4. Margin Trading. You open a margin account and deposit $50,000. You borrow an additional $50,000 from your broker to purchase 2,000 shares of Stock Z at $50 per share. Maintenance margin is 35%. (a) What is your initial margin? (b) Now assume that the price drops to $35. How much money will you need to deposit in your account to bring the margin back to 35%

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