Question: QUESTION 4 You borrow $5000 from your broker and put in $5000 to purchase 100 shares of Disney at the price of $100 per share.

QUESTION 4 You borrow $5000 from your broker and put in

QUESTION 4 You borrow $5000 from your broker and put in $5000 to purchase 100 shares of Disney at the price of $100 per share. The maintenance margin is 35%. How far can the stock price of Disney fall before you will get a margin call? Assume there is no interest. 76.92 82.35 90 87.63

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

The lower the coefficient of variation, the greater the risk. True False

QUESTION 16 You borrow $8,000 from your broker and put in $10,000 to purchase 100 shares of Disney at the price of $180 per share. The maintenance margin is 40%. How far can the stock price of Disney...

You borrow $8,000 from your broker and put in $10,000 to purchase 100 shares of Disney at the price of $180 per share. The maintenance margin is 40%. How far can the stock price of Disney fall before...

You put in $10,000 and borrow $2000 from your broker to purchase 100 shares of Disney at the price of $120 per share on margin. What is the initial margin? 0.5 0.6 0.83 0.62

4.Assume the following information: U.S.deposit rate for 1 year = 11% U.S.borrowing rate for 1 year = 12% Swiss deposit rate for 1 year = 8% Swiss borrowing rate for 1 year = 10% Swiss forward rate...

You have $3,000 to invest. You lose -16% (-$480 loss) when stock market goes down -4%. What is the Margin rate in this market? You are a bond trader, and there has been a power failure in New York...

I have attached the question as a word file, thanks! As we enter week 8, what did you learn from this course? How will the information be useful in your other classes and in your career? Running...

Hello. Can you help with this four question problem? Case PRIVATE EQUITY CASE: MERGER CONSOLIDATION The questions below COMBINE the Ohio & Maryland PT acquisitions as if they are a single c Learning...

6. You are bullish on MSFT. You purchase 100 shares of MSFT stock at the market price using $14,000 of your own money and some additional funds, which you borrow from your broker at an interest rate...

| 6 . You are bullish on MSFT . You purchase 1 0 0 shares of MSFT stock at the market price using $ 2 1 , 0 0 0 of your own money and some additional funds, which you borrow from your broker at an...

Which type of bond investment would you choose, and why, if you wanted a steady, predictable income?

Using the following information, what is the amount of gross profit? Purchases Inventory, September 1 Administrative expense Rent revenue $32,000 5,700 910 1,200 Selling expense Inventory, September...

Which one of the following Rems is typically the starting point when creating pro forma financial statements? Multiple Choice Need for additional fived assets Current flued conts Propected sales...

Organic produce Corporation has nine million shares of common stock outstanding, 500,000 shares of 6 percent preferred stock outstanding, and 200,000 of 9.4 percent semiannual bonds outstanding, par...

Fama's Llamas has a weighted average cost of capital of 9.8 percent. The company's cost of equity is 13 percent, and its cost of debt is 6.5 percent. The tax rate is 35 percent. What is Fama's...

Famas Llamas has a weighted average cost of capital of 8.9 percent. The companys cost of equity is 12 percent and its cost of debt is 7.9 percent. The tax rate is 35 percent. What is Famas target...

Famas Llamas has a weighted average cost of capital of 10.2 percent. The companys cost of equity is 14 percent and its pretax cost of debt is 8.4 percent. The tax rate is 35 percent. What is the...

Currently, the unit selling price of a product is $160, the unit variable cost is $120, and the total fixed costs are $725,000. A proposal is being evaluated to increase the unit selling price to...

write a research proposal on business management of the future of work, hrm in the Ai world

Explain the benefits of a health and wellness strategy

Critique management strategies for health and safety in the workplace

Describe the components of a workplace wellness programme