Question: EXAMPLE: Suppose an investor pays $6,000 (savings margin contributed by the investor) toward the purchase of $10,000 worth of stock (100 shares at $100 per

EXAMPLE: Suppose an investor pays $6,000 (savings margin contributed by the investor) toward the purchase of $10,000 worth of stock (100 shares at $100 per share), borrowing the remaining $4,000 from a broker. Borrowed amount : 10.000 6000 =4000$

How does the initial balance sheet look like?

What is the initial percentage margin?

-Suppose the maintenance margin is 30%. How far could the stock price fall before the investor would get a margin call?

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