Axe G. Reed borrows money from Morley Stangan to buy 1,000 shares of Techno stock (TCN)...

Transcribed Image Text:

Axe G. Reed borrows money from Morley Stangan to buy 1,000 shares of Techno stock (TCN) on marging at a price of $100 per share. The broker asks for a margin of 70% and a maintenance margin of 30%. To what level the price of TCN stock has to fall in order for Morley Stangan trigger a maintenance margin call? Suzan Bond buys a ten year corporate bond at $500 and with an anual coupon of 5%. One year later, she sells the bond for $550. What is Suzan's holding period return on this bond for one year? Axe G. Reed borrows money from Morley Stangan to buy 1,000 shares of Techno stock (TCN) on marging at a price of $100 per share. The broker asks for a margin of 70% and a maintenance margin of 30%. To what level the price of TCN stock has to fall in order for Morley Stangan trigger a maintenance margin call? Suzan Bond buys a ten year corporate bond at $500 and with an anual coupon of 5%. One year later, she sells the bond for $550. What is Suzan's holding period return on this bond for one year?