Kathy Smith has a margin account with a balance of $60,000. Initial margin requirements are 60 percent
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Question:
Kathy Smith has a margin account with a balance of $60,000. Initial margin requirements are 60 percent and Tesla stock is currently selling for $400 per share.
Given this information, how many shares of Tesla can Kathy buy using full margin? If the stock price rises to $425 per share and Kathy closes out her margin position, what will be the rate of return on her investment? Show detailed steps of calculations.
Related Book For
Intermediate Accounting
ISBN: 978-0324300987
10th Edition
Authors: Loren A Nikolai, D. Bazley and Jefferson P. Jones
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