Question: Chapter 3 Assignments 1 . D e Trader opens a brokerage account and purchases 2 0 0 shares of Internet Dreams at $ 4 4

Chapter 3 Assignments
1. De Trader opens a brokerage account and purchases 200 shares of Internet Dreams at $44 per
share. She borrows $4,150 from her broker to help pay for the purchase. The interest rate on the
loan is 10%.
a. What is the margin in Des account when she first purchases the stock?
b. If the share price falls to $34 per share by the end of the year, what is the remaining margin in her
account?
c. If the maintenance margin requirement is 30%, will she receive a margin call?
d. What is the rate of return on her investment?

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